MRD Melcor Developments Ltd

Melcor Real Estate Investment Trust (“Melcor REIT” or the “REIT”) (TSX:MR.UN) today announced the expiration of the “go-shop” period (the “Go-Shop Period”) provided for in the previously announced arrangement agreement dated September 12, 2024 (the “Arrangement Agreement” and the transactions to be completed pursuant to the terms thereof, the “Arrangement”‎), pursuant to which Melcor Developments Ltd. (“Melcor”) has committed to acquire its unowned equity interest (approximately 45%) in Melcor REIT Limited Partnership (“REIT LP”) for $4.95 per unit in cash consideration (the “REIT LP Sale”). Melcor’s unowned equity interest in REIT LP comprises all REIT LP’s outstanding Class A LP Units (approximately 13.0 million units). In accordance with the Arrangement, the REIT will use the proceeds from the REIT LP Sale to repurchase and cancel all of the REIT’s outstanding participating trust units (“Trust Units”).

Following the announcement of the Arrangement, and in accordance with the terms of the Arrangement Agreement, the REIT initiated a "go-shop" process with its financial advisor, BMO Capital Markets ("BMO"), by soliciting third-party interest in submitting an acquisition proposal that is superior to the Arrangement. BMO contacted 100 parties as part of the "go-shop" process and 14 interested parties entered into confidentiality and standstill agreements with the REIT and were granted access to the REIT’s electronic data room, which contained confidential information regarding the REIT and its properties. Certain interested parties did not wish to enter into a confidentiality and standstill agreement and indicated their intention to continue to evaluate the opportunity based on publicly disclosed information. The Go-Shop Period expired at 11:59 p.m. MT on October 15, 2024 with no superior proposal having been received.

As the Go-Shop Period has ended, the "no-shop" provisions in the Arrangement Agreement are now in effect. These provisions limit the REIT and its representatives from initiating or engaging in discussions or negotiations regarding any alternative acquisition proposal, subject to customary “fiduciary out” provisions, pursuant to which, among other things, the REIT may, subject to certain requirements, engage with a person that submits bona fide unsolicited Acquisition Proposal (as such term is defined in the Arrangement Agreement) which constitutes, or could reasonably be expected to constitute or lead to, a ‎Superior Proposal (as such term is defined in the Arrangement Agreement) if consummated in accordance with its terms‎.

The Arrangement remains subject to the satisfaction of customary closing conditions, including obtaining the required approvals (“Unitholder Approval”) from the holders of Trust Units and special voting units of the REIT at the special meeting to consider the Arrangement, scheduled to be held on November 26, 2024 (the "Meeting"), and receiving court approval. It is anticipated that the Arrangement will be completed in the fourth quarter of 2024. The Management Information Circular (the "Circular") and related materials for the Meeting will be available under the REIT’s profile on SEDAR+ at www.sedarplus.ca.

About Melcor Developments Ltd.

Melcor is a diversified real estate development and asset management company that transforms real estate from raw land through to high-quality finished product in both residential and commercial built form. Melcor develops and manages mixed-use residential communities, business and industrial parks, office buildings, retail commercial centres and golf courses. Melcor owns a well diversified portfolio of assets in Alberta, Saskatchewan, British Columbia, Arizona and Colorado.

Melcor has been focused on real estate since 1923. The company has built over 170 communities and commercial projects across Western Canada and today manages 4.79 million sf in commercial real estate assets and 460 residential rental units. Melcor is committed to building communities that enrich quality of life - communities where people live, work, shop and play.

Melcor’s headquarters are located in Edmonton, Alberta, with regional offices throughout Alberta and in Kelowna, British Columbia and Phoenix, Arizona. Melcor has been a public company since 1968 and trades on the Toronto Stock Exchange (TSX:MRD).

Unitholders who have questions, should contact Melcor’s strategic shareholder advisor agent, Laurel Hill Advisory Group, at:North America Toll Free: 1-877-452-7184Collect Calls Outside North America: +1 416-304-0211 (for Shareholders outside Canada and the US)By Email: assistance@laurelhill.com

About Melcor REIT

Melcor REIT is an unincorporated, open-ended real estate investment trust. Melcor REIT owns, acquires, manages and leases quality retail, office and industrial income-generating properties in western Canadian markets. Its portfolio is currently made up of interests in 37 properties representing approximately 3.12 million square feet of gross leasable area located across Alberta and in Regina, Saskatchewan; and Kelowna, British Columbia.

Forward Looking Statements

This news release includes forward-looking information within the meaning of applicable Canadian securities laws. In some cases, forward-looking information can be identified by the use of words such as “may”, “will”, “should”, “expect”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “continue”, and by discussions of strategies that involve risks and uncertainties, certain of which are beyond Melcor's and the REIT’s control. In this news release, forward-looking information includes, among other things, statements relating to expectations with respect to the timing and outcome of the Arrangement and the anticipated benefits of the Arrangement to the parties and their respective security holders, the timing of the Meeting and the results thereof, the likelihood of receipt of a superior proposal. The forward-looking information is based on certain key expectations and assumptions made by each of Melcor and the REIT, including with respect to the structure of the Arrangement and all other statements that are not historical facts. The timing and completion of the Arrangement is subject to customary closing conditions, termination rights and other risks and uncertainties including, without limitation, required regulatory, court, and unitholder approvals. Although management of each of Melcor and the REIT believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that any transaction, including the Arrangement, will occur or that it will occur on the timetable or on the terms and conditions contemplated in this news release. The Arrangement could be modified, restructured or terminated. Readers are cautioned not to place undue reliance on forward-looking information. Additional information on these and other factors that could affect Melcor and the REIT are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR+ website (www.sedarplus.ca).

By its nature, such forward-looking information necessarily involves known and unknown risks and uncertainties that may cause actual results, performance, prospects and opportunities in future periods of Melcor and the REIT to differ materially from those expressed or implied by such forward-looking statements. Furthermore, the forward-looking statements contained in this news release are made as of the date of this news release and neither Melcor, nor the REIT nor any other person assumes responsibility for the accuracy and completeness of any forward-looking information, and no one has any obligation to update or revise any forward-looking information, whether as a result of new information, future events or such other factors which affect this information, except as required by law.

Contact Information:
Investor Relations
Tel: 1.780-945-4795
ir@melcor.ca