Brookfield et al/O&Y

Cash offer by Bidco of Brookfield, CPPIB and ARCA Investments for all the units of O&Y REIT. A subsequent transaction is proposed under which, following the take-up of the tendered units, the declaration of trust for the REIT would be amended to make the units redeemable for the offer price, to be paid for out of the sales proceeds of the REIT assets to the acquisition group. Tendered units of minority unitholders count towards satisfying the requirement that there be approval by a majority of the votes cast by minority unitholders at the meeting to approve this subsequent transaction.

Canadian taxation

Recapture of depreciation (between $2.55 and $2.70 per unit) and net capital gains realized on such asset sale will be allocated on the redeemed units. These amounts reduce those unitholders' proceeds for their redeemed units, so that the allocated capital gains (but not the recapture) are in effect tax-neutral for resident Canadians. Non-residents whose units are redeemed are subject to Part XIII tax on these allocated amounts.