MORGUARD NORTH AMERICAN RESIDENTIAL REIT ANNOUNCES $50 MILLION OFFERING OF CONVERTIBLE DEBENTURES AND FORTHCOMING REDEMPTION OF 4.50% CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES

TSX SYMBOL:    MRG.UN

/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/

TORONTO, Feb. 22, 2023 /CNW/ - Morguard North American Residential Real Estate Investment Trust ("Morguard NAR REIT" or the "REIT") (TSX: MRG.UN), announced today that it has entered into an agreement with a syndicate of underwriters, co-led by RBC Capital Markets and TD Securities Inc., for the purchase by the underwriters, on a bought deal basis, subject to regulatory approval, of $50,000,000 aggregate principal amount of 6.00% convertible unsecured subordinated debentures due March 31, 2028 (the "Debentures"). The Debentures will be convertible, at the option of the holder, into trust units of Morguard NAR REIT at $24.15 per trust unit. Morguard NAR REIT has granted the underwriters an over-allotment option exercisable at any time up to 30 days after Closing, to acquire additional Debentures up to the lesser of $6,750,000 aggregate principal amount of Debentures and the underwriters' respective "Over-Allocation Position" as at the closing date.

As part of the transaction, Morguard Corporation intends to purchase $5,000,000 of the Debentures being offered. 

The REIT also announced that it will redeem all of its outstanding 4.50% convertible unsecured subordinated debentures (the "2018 Debentures") on March 24, 2023 (the "Redemption Date"). The REIT intends to use the net proceeds from the offering, together with existing liquidity, to fund the redemption of the 2018 Debentures, which were issued on February 13, 2018, scheduled to mature on March 31, 2023 and have a par call date of April 1, 2022.

The redemption price has been determined in accordance with the provisions of the trust indenture and the supplemental indenture related to the 2018 Debentures. The redemption price will be paid in cash and is $1,000 per 2018 Debenture together with accrued and unpaid interest on the 2018 Debentures up to, but excluding, the Redemption Date.

Notice of redemption has been delivered today, February 22, 2023, to CDS & Co. ("CDS") and the trustee, Computershare Trust Company of Canada.

Non-registered holders (banks, brokerage firms or other financial institutions) who maintain their interests in the 2018 Debentures through CDS should contact their CDS customer service representative with any questions about the redemption. Alternatively, beneficial holders with any questions about the redemption should contact their respective brokerage firm or financial institution, which holds interests in the 2018 Debentures through CDS on their behalf.

Morguard North American Residential REIT will, by February 24, 2023, file with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada, excluding Quebec, a preliminary short form prospectus relating to the issuance of the Debentures.  The offering is expected to close on or about March 9, 2023.

This press release does not constitute an offer to sell, or the solicitation of an offer to buy, any securities in any jurisdiction. The securities being offered have not been and will not be registered under the U.S. Securities Act of 1933 and state securities laws. Accordingly, the securities may not be offered or sold to U.S. persons except pursuant to applicable exemptions from registration requirements.

About Morguard North American Residential REIT

The REIT is an unincorporated, open-ended real estate investment trust which owns, through a limited partnership, interests in Canadian residential apartment communities, located in Alberta and Ontario, and U.S. residential apartment communities located in Colorado, Texas, Louisiana, Illinois, Georgia, Florida, North Carolina, Virginia and Maryland.

For more information, please visit Morguard.com.

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Certain information in this press release may constitute forward-looking statements that involve a number of risks and uncertainties, including statements regarding the outlook for the REIT's business results of operations, proposed use of proceeds from the offering (including any redemption) and the timing thereof. Forward-looking statements use the words "believe," "expect," "anticipate," "may," "should," "intend," "estimate" and other similar terms, which do not relate to historical matters. Such forward-looking statements involve known and unknown risks and uncertainties and other factors that may cause the actual results to differ materially from those indicated. Such factors include, but are not limited to, general economic conditions, both nationally and in the regions in which the REIT operates; changes in business strategy or development/acquisition plans; environmental exposures; financing risk; existing governmental regulations and changes in, or the failure to comply with, governmental regulations; liability and other claims asserted against the REIT,  and other factors referred to in the REIT's filings with Canadian securities regulators. The REIT believes that the expectations reflected in forward-looking statements are based on reasonable assumptions; however, the REIT can give no assurance that actual results will be consistent with these forward-looking statements. Except as required by applicable law, the REIT disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Readers should be cautioned not to place undue reliance on the forward-looking statements.

SOURCE Morguard North American Residential Real Estate Investment Trust

Morguard North American Residential Real Estate Investment Trust, Mr. K. Rai Sahi, Chairman and Chief Executive Officer, Tel: [phone]; Christopher A. Newman, Chief Financial Officer, Tel: [phone]