/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES
OR DISSEMINATION IN THE UNITED
STATES./
TORONTO, March 1, 2016 /CNW/ - Kingsway Arms Retirement
Residences Inc. ("Kingsway" or the "Company")
(TSX.V: KWA) today announced that it has filed a management
information circular (the "Circular") in connection with an
annual and special meeting (the "Meeting") at which
shareholders will be asked to, among other things, approve the
reverse takeover transaction (the "Reverse Takeover")
previously announced by the Company. The Meeting is scheduled to be
held at 333 Bay Street, Suite 3400, Toronto, Ontario M5H 2S7 at 11:00 a.m. (Toronto time) on March
30, 2016. The record date for determining the shareholders
entitled to receive notice of and vote at the Meeting is
February 29, 2016.
The Company also announced that it has entered into an amended
and restated purchase agreement (the "Amended Purchase
Agreement"), which includes certain changes to the previously
announced Reverse Takeover, including (i) the covenant of
Mainstreet Investment Company LLC (together with its affiliates,
"Mainstreet") and third party investors to, at the request
of Mainstreet Health Holdings Inc. ("MHI Holdco") and
subject to certain conditions, fund an aggregate $15.4 million of the purchase price for the
acquisition of an eleventh senior care property, located in
Hanover Park, Illinois, (the
"Hanover Park Facility") through a loan (in the case of
Mainstreet) and a loan, convertible debentures and/or shares of MHI
Holdco (in the case of the third party investors), which amount
will be reduced by $3.5 million
advanced by Mainstreet to a subsidiary of MHI Holdco by way of a
loan for purposes of funding the deposit, and (ii) the removal of
the right previously granted to the third party investors to
exchange their shares of MHI Holdco for shares of the Company
following completion of the Reverse Takeover.
Other changes to the previously announced Reverse Takeover
include the removal of the annual incentive fee payable to
Mainstreet under the management agreement that will be in effect
following completion of the Reverse Takeover.
As previously disclosed, at the Meeting shareholders will also
be asked to consider a number of additional items in connection
with the Reverse Takeover. Among those items will be the
approval of new articles of the Company (to be effective on the
continuation of the Company from Ontario to British
Columbia), which will contain advance notice provisions. In
particular, the articles will fix a deadline by which shareholders
of record must submit director nominations to Kingsway prior to any
annual or special meeting of Kingsway shareholders. In addition,
shareholders will be asked to approve a deferred share unit plan of
the Company (but will not be asked to approve a restricted share
unit plan as previously announced).
The directors, executive officers and certain shareholders of
Kingsway, who in the aggregate beneficially own approximately 45%
of the outstanding common shares of Kingsway (on a non-diluted
basis), have agreed, pursuant to voting and support agreements, to
vote their common shares in favour of the Reverse Takeover and
other ancillary matters at the Meeting.
The Reverse Takeover is expected to be completed by early
April 2016. Completion of the Reverse
Takeover is subject to a number of conditions, including
disinterested shareholder approval with respect to the Reverse
Takeover. There can be no assurance that the Reverse Takeover will
be completed as proposed or at all.
The Circular is available on SEDAR at www.sedar.com. Investors
are cautioned that, except as disclosed in the Circular, any
information released or received with respect to the Reverse
Takeover may not be accurate or complete and should not be relied
upon.
About Mainstreet
Mainstreet is a U.S. company specializing in real estate
development, value investments and health care. As the
largest developer of transitional care properties in the United States, Mainstreet has been
recognized by Senior Housing News, winning the Architecture &
Design Award in 2013, 2014, and 2015, and has been named to the
Inc. 500/5000 five times since 2010. For additional information,
visit www.mainstreetinvestment.com.
Completion of the Reverse Takeover is subject to a number of
conditions, including disinterested shareholder approval. There can
be no assurance that the Reverse Takeover will be completed as
proposed or at all.
Neither the TSX-V nor any securities regulatory authority has in
any way passed upon the merits of the Reverse Takeover described in
this press release.
Neither the TSX-V nor its Regulation Services Provider (as that
term is defined in the policies of the TSX-V) accepts
responsibility for the adequacy or accuracy of this news
release.
Forward-Looking Statements
Certain information in this press release contains
forward-looking statements or information ("forward looking
statements"), including details about the Reverse Takeover. By
their nature, forward-looking statements are subject to numerous
risks and uncertainties, some of which are beyond the Company's
control, including the impact of general economic conditions,
industry conditions, currency fluctuations, environmental risks,
operational risks, competition from other industry participants,
stock market volatility, the risks that the parties will not
proceed with the Reverse Takeover, that the conditions for
completion of the Reverse Takeover will not be satisfied or waived,
that the conditions for completion of the acquisition of the
Hanover Park Facility by MHI Holdco will not be satisfied or
waived, that the ultimate terms of the Reverse Takeover will differ
from those that are currently contemplated and the ability to
access sufficient capital from internal and external sources.
Although the Company believes that the expectations in its
forward-looking statements are reasonable, its forward-looking
statements have been based on factors and assumptions concerning
future events which may prove to be inaccurate. Those factors and
assumptions are based upon currently available information. Such
statements are subject to known and unknown risks, uncertainties
and other factors that could influence actual results or events and
cause actual results or events to differ materially from those
stated, anticipated or implied in the forward-looking statements.
Accordingly, readers are cautioned not to place undue reliance on
the forward-looking statements, as no assurance can be provided as
to future results, levels of activity or achievements. Risks,
uncertainties, material assumptions and other factors that could
affect actual results are discussed in our public disclosure
documents available at www.sedar.com. Furthermore, the
forward-looking statements contained in this document are made as
of the date of this document and, except as required by applicable
law, the Company does not undertake any obligation to publicly
update or to revise any of the included forward-looking statements,
whether as a result of new information, future events or otherwise.
The forward-looking statements contained in this document are
expressly qualified by this cautionary statement.
SOURCE Kingsway Arms Retirement Residences Inc.