The long awaited circular on Eagle Hospitality Trust’s options was issued late on Dec 8. Stapled securityholders get to vote on as many as four resolutions. The EGM is on Dec 30, but the last date and time to lodge proxy forms and to pre-register for the EGM is at 2pm on Dec 27. (EHT is a stapled security and comprises a dormant business trust (BT) and a REIT, EH-REIT.)

None of the resolutions are friendly to minority stapled securityholders. The choices are stark. In Resolution 1 EH-REIT’s trustee (which is DBS Trustee) proposes SCCPRE Hospitality REIT Management Pte. Ltd, owned by SC Group, be appointed as the new manager.

Resolution 2 is a vote to change the trust deed so that SC Group can get a base fee for FY2021 and FY2022. EHT’s base fee was originally 10% of distributable income of which there is none. The trust deed changes to base fee to a minimum of US$4.5 million or 10% of distributable income whichever is higher (clearly US$4.5 million). The independent financial adviser says the base fee is on "normal commercial terms and is not prejudicial to the interests of EHT and its minority stapled securityholders". Resolution 2 is an extraordinary resolution and may need a 75% vote in favour to pass. 

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