– Transaction reduces the Trust's potential
unit dilution by 8.2% by retiring in-the-money warrants and
replacing them with out-of-the-money warrants –
TORONTO, April 15,
2024 /CNW/ - DRI Healthcare Trust (TSX: DHT.UN) (TSX:
DHT.U) (the "Trust") announces the refinancing of its US$114,760,000 aggregate principal amount of
Series A and Series B preferred securities and 6,369,180
in-the-money warrants (collectively, the "Existing
Securities").
As a result of the refinancing, holders of the Existing
Securities will receive US$135,202,000 of new Series C preferred
securities and 1,749,996 new warrants having an exercise price
representing a 20% premium to the five day volume-weighted average
price of the Trust's units. The Existing Securities will be
canceled upon completion of the refinancing, with holders entitled
to receive accrued and unpaid interest on the Series A and Series B
preferred securities up to and excluding such date.
The reduction in the number of warrants outstanding will reduce
the Trust's potential unit dilution upon exercise by 4.6 million
units, or 8.2% of current units outstanding.
Financial Terms
The Series C preferred securities will be unsecured,
subordinated debt securities of the Trust and have a principal
amount of US$135,202,000. The Series
C preferred securities will have substantially the same terms as
the Series A preferred securities, but will mature in April 2074. The Series C preferred securities
will initially pay cash interest at a rate of 7.50% per annum on
the principal amount of the Series C preferred securities
outstanding, payable semi-annually on April
30 and October 31 of each
year. The Series C preferred securities will not be redeemable by
the Trust prior to April 30, 2029,
except in the event of a change of control of the Trust.
The interest rate on the Series C preferred securities will
increase to 10% per annum if any of the Series C preferred
securities are outstanding on April 30,
2029, and will be subject to an annual increase of 1.5% per
annum if outstanding on each one year anniversary of such date, up
to a specified cap.
The new warrants will entitle the holders thereof to acquire one
Trust unit for an exercise price of US$15.00 at any time until the expiry of the
warrants five years from date of issue. The warrant exercise price
represents a 20% premium to the volume-weighted average price of
the Trust's units for the five trading days ending April 12, 2024.
The refinancing of the Securities is conditional upon consent of
the holders of the Existing Securities and other customary
conditions, including the approval of the Toronto Stock Exchange
for the issuance of the new warrants.
The refinancing is expected to be completed in April 2024.
Copies of the supplemental indenture for the Series C preferred
securities, the amended and restated trust indenture for the
preferred securities and the warrant indenture for the new warrants
will be filed on www.sedarplus.ca. This press release is only a
summary of certain principal terms of the transaction, and is
qualified in its entirety by reference to the more detailed
information that will be contained in such documents.
Scotia Capital Inc. acted as exclusive financial advisor to the
Trust.
About DRI Healthcare
Trust
DRI Healthcare Trust is managed by DRI Capital Inc. ("DRI
Capital"), the pioneer in global pharmaceutical royalty
monetization with a more than 35-year history of accelerating
innovation by providing capital to inventors, academic institutions
and biopharma companies. Since its founding in 1989, DRI Capital
has deployed more than US$3.0
billion, acquiring more than 70 royalties on 45-plus drugs,
including Eylea, Keytruda, Orserdu, Spinraza, Stelara,
Vonjo, Zejula and Zytiga. DRI Healthcare Trust's units are
listed and traded on the Toronto Stock Exchange in Canadian dollars
under the symbol "DHT.UN" and in US dollars under the symbol
"DHT.U". To learn more, visit drihealthcare.com or follow us
on LinkedIn.
SOURCE DRI Healthcare Trust