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Press release from CNW Group

Plazacorp Retail Properties Ltd. graduates to Toronto Stock Exchange; completes acquisition of remaining KEYreit units

Wednesday, June 26, 2013

Plazacorp Retail Properties Ltd. graduates to Toronto Stock Exchange; completes acquisition of remaining KEYreit units

11:58 EDT Wednesday, June 26, 2013

FREDERICTON, June 26, 2013 /CNW/ - Plazacorp Retail Properties Ltd. (TSXV: PLZ) ("Plazacorp") is pleased to announce that it has received conditional approval for its graduation to the Toronto Stock Exchange (the "TSX") from the TSX Venture Exchange.  Subject to meeting certain conditions, Plazacorp expects its common shares ("Plazacorp Shares") to begin trading on the TSX on July 2, 2013 under the symbol "PLZ".  As a result of this graduation there will be no further trading of Plazacorp Shares on the TSX Venture Exchange following close of markets on June 28, 2013.

Completion of Subsequent Acquisition Transaction

Additionally, Plazacorp is pleased to announce that is has acquired the remaining 1,720,922 units ("Units") of KEYreit not deposited under its previously announced offer dated April 10, 2013 (the "Offer") to purchase all of the Units for, at the election of each unitholder of KEYreit, either (a) Cdn.$8.35 in cash or (b) 1.7041 of a Plazacorp Share, subject, in each case, to pro ration.  Plazacorp acquired the remaining Units pursuant to the Plazacorp acquisition right under KEYreit's amended and restated Declaration of Trust.  Following completion of this subsequent acquisition transaction, Plazacorp now owns 15,009,292 Units, representing 100% of the issued and outstanding Units.

Upon delivery today of an acquisition notice, all outstanding Units were deemed to have been sold to Plazacorp, for the same consideration and on the same terms as the Units acquired by Plazacorp under the Offer. Accordingly, KEYreit unitholders who elected the cash alternative will receive Cdn.$6.51, representing 78% of the total cash amount elected, plus 0.375 of a Plazacorp Share for each Unit tendered. KEYreit unitholders who elected the share alternative will receive 1.7041 of a Plazacorp Share, representing 100% of the total number of Plazacorp Shares elected, subject in each case to adjustment for fractional shares.  Accordingly, Plazacorp will issue approximately 1,478,362 Plazacorp Shares in respect of the subsequent acquisition transaction.

As of the close of markets on June 28, 2013, the Units will cease to be listed for trading on the TSX.  Plazacorp intends to cause KEYreit to file with the applicable Canadian securities regulatory authorities the necessary documentation to cease to be a reporting issuer in all of the jurisdictions in which KEYreit is currently a reporting issuer.

KEYreit Debentures Replaced by Plazacorp Debentures

Concurrently with the completion of the subsequent acquisition transaction, Plazacorp, KEYreit and CIBC Mellon Trust Company have entered into a supplemental indenture (the "Supplemental Indenture") pursuant to which the 7.75% convertible unsecured subordinated debentures due December 31, 2014 (the "2009 Debentures"), the 8.00% convertible unsecured debentures due December 31, 2016 (the "2011 Debentures") and the 7.00% convertible unsecured debentures due December 31, 2017 (the "2012 Debentures" and, together with the 2009 Debentures and the 2011 Debentures, the "Debentures") have become obligations of Plazacorp in accordance with the terms of their respective indentures.  Accordingly, Plazacorp expects that the 2009 Debentures, 2011 Debentures and 2012 Debentures will commence trading on the TSX as Plazacorp Debentures as of the open of markets on July 2, 2013, under the symbols "PLZ.DB.A", "PLZ.DB.B" and "PLZ.DB.C", respectively.

Following the entering into of the Supplemental Indenture, the Debentures are no longer convertible into Units and are instead convertible into an amount of cash and Plazacorp Shares that a holder of Debentures would have been entitled to receive if, on the date of the subsequent acquisition transaction, it had been the registered holder of the number of Units which it was entitled to acquire upon the exercise of its conversion right. Accordingly, each $1,000 principal amount of the 2009 Debentures is convertible into $117.25 in cash and 188 Plazacorp Shares, each $1,000 principal amount of the 2011 Debentures is convertible into $99.76 in cash and 169 Plazacorp Shares and each $1,000 principal amount of the 2012 Debentures is convertible into $112.76 in cash and 190 Plazacorp Shares.  The amount of cash into which the Debentures will be convertible is based on the maximum cash consideration available under the subsequent acquisition transaction and assuming full conversion of all the Debentures as of the date of the subsequent acquisition transaction.

ABOUT PLAZACORP

Plazacorp is a mutual fund corporation that is a leading retail property owner and developer, particularly in Eastern Canada. Plazacorp has an entrepreneurial focus with strong "value-add" capabilities.  Plazacorp's current portfolio includes interests in 347 properties totaling approximately 6.4 million square feet across Canada and additional lands held for development.  Plazacorp's properties include a mix of strip plazas, stand-alone small box retail outlets and enclosed shopping centres, anchored by approximately 90% national tenants.  Total assets have reached almost $1 billion.  Plazacorp is fully internalized, therefore providing shareholders directly with the synergies that come with an internalized management structure.  Plazacorp has proven its strong "value-add" capabilities to develop, redevelop and acquire retail real estate throughout Canada.  Plazacorp has a strong track record of generating growth in distributions, having increased its distributions at least once every year in the last 10 years.

More information about Plazacorp can be found on our website at www.plaza.ca or at www.sedar.com.

CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING INFORMATION

This news release contains forward looking statements relating to our operations and the environment in which we operate, which are based on our expectations, estimates, forecasts and projections. These statements are not future guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward looking statements. Readers, therefore, should not place undue reliance on any such forward looking statements. Further, a forward looking statement speaks only as of the date on which such statement is made. We undertake no obligation to publicly update any such statement, to reflect new information or the occurrence of future events or circumstances, except for forward-looking information disclosed in prior disclosures which, in light of intervening events, requires further explanation to avoid being misleading.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: Plazacorp Retail Properties Ltd.

For further information:

Visit our website at: www.plaza.ca

Or contact:

Michael Zakuta (President and CEO) at (514) 457-0997 ext #228, or
Floriana Cipollone (Chief Financial Officer) at (416) 848-4583

Plazacorp Retail Properties Ltd.
527 Queen Street, Suite 200
Fredericton, NB
E3B 1B8

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