Chartwell and Health Care REIT Acquire Maestro Portfolio

Chartwell Seniors Housing REIT (“Chartwell”) and Health Care REIT, Inc. (“HCN”) completed the acquisition from the five Maestro Retirement Residences Funds of a portfolio of 8,187 suites in 42 retirement communities in key Canadian growth markets for a net purchase price of approximately $931 million. The retirement communities are located in Quebec, Ontario, Alberta and British Columbia. The transaction received the approvals of both the Competition Bureau and Investment Canada.

Chartwell and HCN formed a co-ownership, each acquiring a 50 per cent undivided interest in 39 of the retirement communities with 7,662 suites, for a net purchase price of approximately $850 million. HCN also acquired a 100 per cent interest in three of the retirement communities with 525 suites. The net purchase price for the three communities was approximately $81 million.

In connection with the acquisition, on March 9, 2012, Chartwell completed public offerings of 24,913,125 subscription receipts at a price of $8.20 per subscription receipt for gross proceeds of $204,287,625 and $135,000,000 aggregate principal amount of 5.7 per cent convertible unsecured subordinated debentures, including the exercise, in full, of the over-allotment options in respect of the subscription receipts and the debentures. The offerings were completed on a bought deal basis through a syndicate of investment dealers led by RBC Capital Markets and including CIBC World Markets Inc., BMO Nesbit Burns Inc., Scotia Capital Inc., National Bank Financial Inc., TD Securities Inc., Canaccord Genuity Corp. and GMP Securities L.P.

The net proceeds from the debenture offering were used to redeem the previous series of outstanding convertible debentures and reduce the amounts outstanding on Chartwell's credit facility. The net proceeds from the subscription receipt offering were used to pay a portion of the purchase price for the acquisition of Chartwell's interest in the retirement communities, as well as Chartwell's expenses with respect to the acquisition.

Chartwell was led by Jonathan Boulakia, Executive Vice-President and General Counsel, and by Osler, Hoskin & Harcourt LLP with a team led by Chris Murray (corporate) and Rod Davidge (real estate) that included Nicole Cloutier, Craig Harkness, Lindsay Hamilton, Stella Di Cresce and Brian Donnelly (real estate); Terry Burgoyne, David Hanick, David Vernon, Adam Gutkin, Courtney Ashton and Caitlin Gossage (corporate); Michael Matheson (financial services); Peter Glossop and Kaeleigh Kuzma (competition and Investment Canada); Michael Watts and Leah Stransbury (health); Kimberley Wharram and David Davachi (tax) and in the United States, Jason Comerford (US corporate) and Paul Seraganian, Kevin Colan and Jennifer Lee (US tax). Stikeman Elliott LLP acted for Chartwell and Health Care REIT Inc. in connection with loan assumptions relating to Quebec properties, with procuring Canada Mortgage and Housing Corporation consent to such assumptions as well as Quebec environmental matters, with a team led by Neil Bindman that included Lana Rabinovitch, Elizabeth Labrie and Alison Bier (real estate) and Myriam Fortin (environmental).

Health Care REIT Inc. was led by Charles Hiller, Associate General Counsel with a team that included Megan Wolfinger, and by Goodmans LLP in Canada, with a team led by Jon Northup (tax) and Ira Barkin (real estate) that included Daniel Gormley, Gail Jaffe, Joanna Creed and Victoria Petherbridge (corporate); Mitchell Sherman and Glenn Ernst (tax); Richard Annan (competition); Joel Schachter (Investment Canada) and Jordie Saperia (real estate). Sidley Austin LLP (Chicago) represented Health Care REIT, Inc. in the United States with a team comprising David Zampa, Seth Katz and Andrea Reed. Arnold & Porter LLP advised Health Care REIT, Inc. on United States tax matters with a team led by Joe Howe and Cynthia Mann. Shumaker, Loop & Kendrick, LLP (Toledo, Ohio) also represented Health Care REIT, Inc. in the United States on various corporate law matters with a team led by Mary Ellen Pisanelli, Cindy Rerucha and Michael McGowan.

The Maestro Residences Retirement Funds were represented by Fasken Martineau DuMoulin LLP with a team led by Claude Gendron that included Robert Paré, Alain Riendeau, Gabriel Castiglio, Philip Aubry and Luc Morin (corporate and governance); Jean Philippe Gagné, Nicolas Leblanc, Élise Béland and Jonathan Cohen (Montreal, real estate); Mark Brennan and Doug Edmison (Toronto, real estate); Stuart Blyth and Chelsea Bushfield (Calgary, real estate); David Martin (Vancouver, real estate); Gilles Carli (tax); Douglas New and Juho Song (competition and Investment Canada); Louise Béchamp (labour); Jean-Philippe Mikus and Charles Lupien (intellectual property). Luc Chagnon acted as in-house counsel.

The underwriters were led by Borden Ladner Gervais LLP with a team that included Paul Mingay, Dyana McLellan, Habeeb Syed and Jeffrey Spiegel (corporate) and Craig Webster (tax).

FCT provided commercial title insurance for Chartwell's and HCN's interests in the properties.