MPW Medical Properties Trust Inc

On June 7, 2018, affiliates of Medical Properties Trust, Inc. and MPT Operating Partnership, L.P. (together with their consolidated subsidiaries, the “Company”) entered into a subscription agreement (the “Subscription Agreement”) with Primotop Holding S.à.r.l. (“Primotop”), a company managed by an entity of the Primonial group pursuant to which Primotop will acquire a 50% interest by way of a joint venture in the real estate of 71 post-acute hospitals in Germany (the “Portfolio”) currently owned by the Company, with an aggregate agreed valuation of approximately €1.635 billion.

Pursuant to the Subscription Agreement, which was entered into among MPT Operating Partnership, L.P., Primotop and MPT RHM Holdco S.à.r.l., a subsidiary of the Company and the current indirect owner of the Portfolio, Primotop will subscribe for new shares representing, following issuance, 50% of the outstanding interests in MPT RHM Holdco S.à.r.l. (the “Joint Venture”) in exchange for a cash amount equal to 50% of the estimated net asset value of the Portfolio at the closing of the transaction (the “Closing”), subject to certain adjustments set forth in the Subscription Agreement. The remaining 50% interest in the Joint Venture will be retained by the Company. Immediately following the Closing, which is expected to occur during the third quarter of 2018, the Joint Venture is expected to make cash distributions to the Company in an aggregate amount of approximately €1.14 billion from the proceeds of the cash contributions and certain debt financings.

The Subscription Agreement provides that the Joint Venture will be governed by a Shareholders’ Agreement to be entered into upon Closing by and among the parties to the Subscription Agreement. In addition, affiliates of the Company will continue to manage the Portfolio pursuant to a management agreement to be entered into upon Closing.

The Subscription Agreement contains customary mutual representations, warranties and covenants by the parties in connection with transactions of this nature, including a covenant for the Company to conduct the business of the Portfolio as a going concern in the ordinary course prior to the Closing.

Pursuant to the Subscription Agreement, the Closing is subject to certain closing conditions, including (i) the receipt of governmental approval for the transaction from the German Federal Cartel Office, (ii) obtaining third-party financing in the form of a syndicated secured financing facility, and (iii) the completion of certain pre-Closing reorganization transactions. In addition to providing the parties with certain customary termination rights, the Subscription Agreement also grants the Company with a termination right in the event of certain changes in German real estate transfer tax law that would trigger indemnity obligations by the Company to Primotop. The Company has also agreed to indemnify Primotop, subject to certain limitations, for certain customary pre-close indemnifiable losses.

The foregoing description of the Subscription Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the Subscription Agreement, which the Company expects to file as an exhibit to its Quarterly Report on Form 10-Q for the quarter ended June 30, 2018.