Jun 29, 2016
The tenant under the lease will be a subsidiary of
SNH funded the purchase of the seven communities with cash on hand and
drawings under its
Simultaneously with the purchase and lease transaction,
“SNH is pleased to add these quality assets that produce attractive
returns with solid rent coverage to its triple net leased senior living
portfolio,” said
Five Star was formerly SNH’s wholly owned subsidiary until Five Star’s
shares were distributed to SNH shareholders. SNH is currently Five
Star’s largest shareholder, owning 4,235,000 Five Star common shares
(8.6% of the Five Star shares outstanding). One of the Trustees of SNH
is also a Director of Five Star, and both
WARNING REGARDING FORWARD LOOKING STATEMENTS
THIS PRESS RELEASE INCLUDES STATEMENTS AND HAS IMPLICATIONS WHICH CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER SNH USES WORDS SUCH AS BELIEVES, EXPECTS, INTENDS, ANTICIPATES, ESTIMATES, WILL, MAY OR SIMILAR EXPRESSIONS, SNH IS MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON SNH’S CURRENT INTENT, BELIEFS, OR EXPECTATIONS, BUT THEY ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR FOR VARIOUS REASONS. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE STATED OR IMPLIED BY FORWARD LOOKING STATEMENTS. FOR EXAMPLE:
-
THIS PRESS RELEASE STATES THAT THE RENT PAYABLE BY FIVE STAR FOR THE
SEVEN COMMUNITIES THAT SNH HAS ACQUIRED MAY INCREASE STARTING AFTER
2017. SUCH RENT INCREASES UNDER THE LEASE ARE DETERMINED BASED UPON A
PERCENTAGE OF REVENUE INCREASES AT THE LEASED COMMUNITIES. IT
IS IMPOSSIBLE TO KNOW WHETHER FUTURE REVENUES AT THE LEASED COMMUNITIES WILL INCREASE AND, IN FACT, FUTURE RENTS MAY NOT INCREASE. - THIS PRESS RELEASE STATES THAT THE CHANGES MADE IN THE CONTRACTS PURSUANT TO WHICH FIVE STAR MANAGES SENIOR LIVING COMMUNITIES FOR SNH ARE NOT EXPECTED TO HAVE A MATERIAL IMPACT UPON SNH’S EARNINGS FROM THE MANAGED COMMUNITIES AND THAT THE REVISED FORMULAS FOR CALCULATING FIVE STAR’S MANAGEMENT FEES MAY CREATE INCENTIVES FOR IMPROVED PERFORMANCE BY FIVE STAR IN THE FUTURE. AN IMPLICATION OF THESE STATEMENTS MAY BE THAT SNH WILL BENEFIT FROM THESE CHANGES. IN FACT, FIVE STAR WILL REALIZE SOME IMMEDIATE BENEFITS FROM CHANGES TO THE MANAGEMENT ARRANGEMENTS FOR CERTAIN COMMUNITIES AND THE BENEFITS WHICH SNH MAY REALIZE FROM THE IMPROVED INCENTIVES DEPEND UPON FIVE STAR’S OWN FUTURE PERFORMANCE. ACCORDINGLY, THERE CAN BE NO ASSURANCE THAT SNH WILL BENEFIT FROM THE CHANGES MADE TO THE CONTRACTS UNDER WHICH FIVE STAR MANAGES COMMUNITIES.
- THIS PRESS RELEASE STATES THAT THE TERMS OF THE TRANSACTIONS ANNOUNCED TODAY WERE NEGOTIATED AND APPROVED BY SPECIAL COMMITTEES OF SNH’S INDEPENDENT TRUSTEES AND FIVE STAR’S INDEPENDENT DIRECTORS WHO ARE NOT ALSO TRUSTEES OR DIRECTORS OF THE OTHER PARTY AND WHO ARE INDEPENDENT OF RMR, AND THAT THESE COMMITTEES WERE REPRESENTED BY SEPARATE LEGAL COUNSEL. AN IMPLICATION OF THESE STATEMENTS IS THAT THE TERMS OF THESE TRANSACTIONS WERE SIMILAR TO THE TERMS THAT WOULD HAVE BEEN ACHIEVED BY NEGOTIATIONS BETWEEN UNRELATED PARTIES. SNH CAN PROVIDE NO ASSURANCE THAT THE TERMS OF THESE TRANSACTIONS ARE THE SAME AS WOULD HAVE BEEN ACHIEVED BY NEGOTIATIONS BETWEEN UNRELATED PARTIES. ALSO, THE FACT THAT THESE TERMS WERE NEGOTIATED AND APPROVED BETWEEN RELATED PARTIES MAY CAUSE SOMEONE TO CHALLENGE THESE AGREEMENTS AND SUCH CHALLENGES MAY BE EXPENSIVE TO DEFEND EVEN IF THE CHALLENGES ARE WITHOUT MERIT.
THE INFORMATION CONTAINED IN SNH’S FILINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION, OR THE
FOR THESE AND OTHER REASONS, INVESTORS SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING STATEMENTS OR THEIR IMPLICATIONS.
EXCEPT AS REQUIRED BY LAW, SNH DOES NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160629006458/en/
Director,
Investor Relations
Source: