Agel­lan en­ters set­tle­ment deal with dis­si­dent Sand­piper

Stockwatch Daily - - FINANCE - Mr. Frank Ca­men­zuli re­ports

AGEL­LAN COM­MER­CIAL Real Es­tate In­vest­ment Trust has en­tered into a strate­gic set­tle­ment agree­ment with ELAD Canada Inc. and Sand­piper Group.

The agree­ment is unan­i­mously sup­ported by the board of trustees of the REIT with Rafael Lazer, cur­rent trustee and chief ex­ec­u­tive of­fi­cer of ELAD, hav­ing de­clared his in­ter­est and ab­stained. As part of the agree­ment, Sand­piper has with­drawn its pre­vi­ously an­nounced unitholder meet­ing req­ui­si­tion, and each of ELAD and Sand­piper has agreed with the REIT to vote in favour of the newly re­con­sti­tuted board at the an­nual meet­ing of unithold­ers to be held in 2018.

“We are pleased to have reached an agree­ment with ELAD and Sand­piper that we be­lieve rep­re­sents a pos­i­tive out­come for all unithold­ers and avoids a costly proxy con­test,” said Frank Ca­men­zuli, chief ex­ec­u­tive of­fi­cer of Agel­lan. “We look for­ward to con­tin­u­ing to ex­e­cute on our strate­gic plan and grow­ing Agel­lan into a dom­i­nant pure play in­dus­trial REIT for years to come,” added Mr. Ca­men­zuli.

“We are ex­cited that ELAD, to­gether with Sand­piper, will get to play a more mean­ing­ful role in the fu­ture of Agel­lan and that the REIT’s man­age­ment team led by our CEO, Frank Ca­men­zuli, re­mains an im­por­tant part­ner of the REIT,” said Mr. Lazer.

“We are ap­pre­cia­tive that Agel­lan’s board worked con­struc­tively with Sand­piper and ELAD and are con­fi­dent that the re­con­sti­tuted board is well po­si­tioned to sup­port man­age­ment in achiev­ing the REIT’s full po­ten­tial,” said Renzo Baraz­zuol, pres­i­dent and chief oper­at­ing of­fi­cer, Sand­piper.

High­lights of the agree­ment in­clude:

• As­set man­age­ment of Agel­lan has been in­ter­nal­ized, and the pur­chase agree­ment terms have been amended to pro­vide for a pur­chase price of up to $13-mil­lion. The pur­chase price con­sists of an up­front $10-mil­lion pay­ment that was sat­is­fied en­tirely with ex­change­able Class B limited part­ner­ship units of a sub­sidiary of the REIT and up to $3-mil­lion of con­tin­gent cash pay­ments based on the REIT achiev­ing cer­tain per­for­mance thresh­olds for cal­en­dar years 2018 and 2019. In ad­di­tion, the REIT’s his­tor­i­cal as­set man­ager will now also be en­ti­tled to the 2017 in­cen­tive fee pay­ment that had been pre­vi­ously waived as part of the orig­i­nal as­set pur­chase agree­ment. Clos­ing of the in­ter­nal­iza­tion oc­curred con­cur­rently with the ex­e­cu­tion of the agree­ment.

• The board re­mains at seven mem­bers with the im­me­di­ate ad­di­tion of three, highly qual­i­fied in­di­vid­u­als: Mr. Baraz­zuol, Dov Meyer and Aida Tam­mer. Richard Dansereau, An­thony Messina and Kelly Smith have vo lun t ar­ily stepped down from the board to make way for the new trustees.

• Glen Ladouceur, the cur­rent chair of the au­dit com­mit­tee, has be­come the new chair­man of the board of the REIT.

New board com­po­si­tion The new board con­sists of the fol­low­ing trustees:

• Ex­ist­ing board mem­bers: Mr. Ladouceur, who has been ap­pointed chair­man of the board; Mr. Ca­men­zuli; Dayna Gibbs; and Mr. Lazer;

• New board mem­bers: Mr. Baraz­zuol; Mr. Meyer; and Ms. Tam­mer.

Mr. Meyer rep­re­sents an agreed-upon in­de­pen­dent nom­i­nee by both ELAD and the REIT. Mr. Meyer is a well-re­spected real es­tate vet­eran who has con­sid­er­able ex­pe­ri­ence in the U.S. in­vest­ment mar ket bot h as a prin­ci­pal and as a lender.

Mr. Baraz­zuol is cur­rently Sand­piper’s pres­i­dent and COO and was for­merly the chief fi­nan­cial of­fi­cer for the Aquilini In­vest­ment Group (2008 to 2016, ini­tially as chief fi­nan­cial of­fi­cer of the real es­tate devel­op­ment group).

Ms. Tam­mer has 25 years of cor­po­rate gov­er­nance, cap­i­tal mar­kets and real es­tate in­vest­ment ex­pe­ri­ence, hav­ing ad­vised on nu­mer­ous real es­tate in­vest­ment trust ini­tial pub­lic of­fer­ings and merger-and-ac­qui­si­tion trans­ac­tions, debt and eq­uity of­fer­ings, and prop­erty trades to­talling over $30-bil­lion.

The board is ex­tremely pleased that it was able to avoid a costly and dis­tract­ing proxy fight by reach­ing a res­o­lu­tion for the ben­e­fit of all unithold­ers. The REIT looks for­ward to up­dat­ing unithold­ers in the near fu­ture on the con­tin­ued ex­e­cu­tion of its strate­gic plan.

We seek Safe Har­bor.

Karen Bax­ter con­densed this news re­lease (karenb@stock­watch.com).

Fran­cis Xavier Ca­men­zuli, Richard Dansereau, Dayna Gibbs, Glen Joseph Ladouceur, Rafael Lazer, An­thony J Messina, Kelly Lynne Smith

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