IOT Innovotech Inc

InnVest Real Estate Investment Trust ("InnVest") (TSX:INN.UN) announced today
its estimation of the fair market value of the non-voting units ("IOT Units") of
InnVest Operations Trust, a newly-formed taxable trust ("IOT"), which will be
distributed to InnVest's unitholders as part of an internal reorganization (the
"Reorganization"). The Reorganization is anticipated to be completed by December
31, 2010 (the "Effective Date") and was approved by InnVest's unitholders at a
special meeting on June 16, 2010. The plan of arrangement under the Canada
Business Corporations Act forming part of the Reorganization was also approved
by the Ontario Superior Court of Justice. InnVest is pursuing the Reorganization
in order to become a Qualifying REIT under Canadian income tax rules applicable
to specified investment flow-through (SIFT) entities.


Under the Reorganization, InnVest will transfer all of its directly and
indirectly held operating assets to IOT. IOT (through its subsidiaries) will
hold the operating assets, earn revenues from hotel customers and pay rent to
subsidiaries of InnVest (the owners of the hotels). IOT will also indirectly
hold (through a subsidiary) a 50% interest in Choice Hotels Canada Inc. and will
earn revenues from franchising fees.


Each InnVest unitholder will receive one IOT Unit for each InnVest unit held on
the Effective Date. Thereafter, each issued and outstanding InnVest unit will
trade together with an IOT Unit on a "stapled" basis unless the unitholders of
InnVest vote in favour of an uncoupling of the stapled units or the trustees of
the REIT or IOT approve an uncoupling in the event of a bankruptcy or
insolvency.


As described in more detail in InnVest's management information circular dated
May 13, 2010 (the "Circular"), Part XIII.2 of the Income Tax Act (Canada) (the
"Tax Act") imposes a tax on each holder of InnVest units that is a non-resident
of Canada or a partnership other than a Canadian partnership as described in the
Tax Act (a "Non- Resident Unitholder") equal to 15% of all or most of the fair
market value of the IOT Units at the time of their distribution.


It is estimated that each IOT Unit will have a fair market value of
approximately $0.9585 on the Effective Date, and that Part XIII.2 non-resident
withholding tax of 15% of this amount, or approximately $0.1438, is required to
be paid in respect of each IOT Unit distributed to Non-Resident Unitholders.


InnVest will issue a press release on the Effective Date confirming management's
calculation of the amount of non-resident withholding tax payable by a
Non-Resident Unitholder per IOT Unit distributed.


Non-Resident Unitholders are encouraged to consult their broker or investment
advisor with regard to arrangements for payment of any applicable Part XIII.2
non-resident withholding tax. Unitholders are also encouraged to review in
detail the Circular for more information.


FORWARD LOOKING STATEMENTS

Statements contained in this press release that are not historical facts are
forward-looking statements which involve risk and uncertainties which could
cause actual results to differ materially from those expressed in the
forward-looking statements. Among the key factors that could cause such
differences are real estate investment risks, hotel industry risks and
competition. These and other factors are discussed in InnVest's annual
information form dated March 10, 2010 which is available at www.sedar.com or
www.innvestreit.com. InnVest disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise, unless required to do so by applicable securities
law.


TRUST PROFILE

InnVest REIT holds Canada's largest hotel portfolio together with an interest in
Choice Hotels Canada Inc. the largest franchisor of hotels in Canada. The hotel
portfolio currently comprises 144 hotel properties, with approximately 19,000
guest rooms, operated under internationally recognized franchise brands such as
Comfort Inn(R), Holiday Inn(R), Quality Suites/Inn(R), Radisson(R), Delta(R),
Travelodge(R), Hilton(R) Staybridge Suites(R), Fairmont Hotels(R), Sheraton
Suites(R) and Best Western(R). InnVest's trust units and outstanding convertible
debentures trade on the Toronto Stock Exchange under the symbols INN.UN,
INN.DB.B, INN.DB.C, INN.DB.D, and INN.DB.E.

Innovotech (TSXV:IOT)
Historical Stock Chart
From Jun 2024 to Jul 2024

Innovotech (TSXV:IOT)
Historical Stock Chart
From Jul 2023 to Jul 2024