Response to Restricted Transfer Notice 3 month status report

vitalhealthcareproperty.co.nz

4 July 2013

Response to Restricted Transfer Notice three month status report

Background

On 2 April 2013, NorthWest International Healthcare Properties Real Estate Investment Trust (“NorthWest”) gave a Restricted Transfer Notice (“RTN”) to Vital Healthcare Management Limited (“Manager”) as manager of Vital Healthcare Property Trust (“Vital”). The RTN advised NorthWest’s intention to acquire up to 24.99% of the units in Vital by on-market purchases at per-unit prices in the range of $1.15 to $1.38.

Due to the association between NorthWest and two Directors of the Manager (Paul Dalla Lana and Bernard Crotty), the Board of the Manager formed a committee of all of the Independent Directors of the Manager (Graeme Horsley (Chairman), Andrew Evans and Claire Higgins) to deal with, and respond to, the RTN.

On 19 April 2013, the Independent Directors wrote to unitholders to advise them of their response to the RTN (“Independent Directors’ Letter”), and to provide them with a copy of an Independent Appraisal Report on the RTN prepared by KordaMentha (“Appraisal Report”), in each case as required by the Listing Rules.

Three month Status Report

On 2 July 2013, NorthWest provided the Manager with a three month Status Report on the RTN (“Status Report”).

Under the Listing Rules, NorthWest was required to give the Status Report in order to continue to purchase units in reliance on the RTN.

The Status Report confirms that NorthWest “remains keen to continue to support Vital and intends to increase its proportionate holding of units to 24.99% in an orderly fashion, whether through supporting Vital’s recently announced capital raising or on-market purchases”.

The Status Report also states that, between 2 April 2013 and 2 July 2013, NorthWest acquired an interest in 66,673 units in reliance on the RTN.

Response to the Status Report

As noted above, the Independent Directors’ response to the RTN is set out in the Independent Directors’ Letter.

Unitholders are encouraged to read that letter, and the Appraisal Report that accompanied it, in full.

In response to the Status Report, as required by the Listing Rules, the Independent Directors advise as follows:
- They are not aware of any change in circumstances which would affect the continuing relevance and currency of the Appraisal Report or the information notified in the Independent Directors’ Letter in compliance with Listing Rule 4.5.6.

- They believe that Vital is in compliance with Listing Rule Further information In addition to the confirmations required by the Listing Rules, the Independent Directors note the following matters:

- The Appraisal Report states that an equity capital raising is envisaged by Vital. In this regard, on 26 June 2013, Vital announced that it intends to raise up to $39.2 million of new equity capital by way of 1-for-10 pro-rata renounceable rights issue of new units at a price of $1.275 per unit (the “Offer”). The Simplified Disclosure Prospectus for the Offer was registered today with the Registrar of Financial Service Providers.

- As announced on 26 June 2013, NorthWest, which holds units through related or associated entities, has indicated to the Board that it will ensure that those entities take up their full entitlement to new units under the Offer and that one of those entities will apply for additional new units under the Offer’s oversubscription facility. NorthWest has advised the Board that its related or associated entities will not apply for units that will in aggregate take NorthWest’s interest in Vital above 24.99% of all units on issue.

- NZX has ruled that an increase in the percentage of votes attached to units in Vital controlled by NorthWest and its Associated Persons (as defined in the Listing Rules) from 20.001% to 24.99% (including by way of the issue of units under the Offer) will not constitute a material increase in NorthWest and its Associated Persons' ability to exercise, or direct the exercise of, effective control of Vital in terms of Rule 7.5.1. This means that unitholder approval is not required to the issue of units to NorthWest under the Offer.

- As noted in the Independent Directors’ Letter and Appraisal Report, NorthWest could under the Listing Rules increase its interest to above 25% of all units on issue. NorthWest has advised the Board that it has no present intention to do so (although this intention could change).

- The Appraisal Report contains information on the value of Vital’s property portfolio at 31 December 2012.

On 26 June 2013, Vital announced a preliminary unaudited portfolio revaluation increase as at 30 June 2013.

ENDS

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