NEWTOWN SQUARE, Pa., Nov. 5 /PRNewswire-FirstCall/ — GMH Communities Trust (NYSE: GCT), one of the leading providers of housing, lifestyle and community solutions for college students and members of the U.S. military and their families, today reported that it has reached a final settlement agreement with the lead plaintiffs in the class action lawsuit brought on behalf of purchasers of the Company’s common shares between May 5, 2005 and March 10, 2006. The Company also announced that it has reached final settlement on related claims brought in early 2007 by certain unitholders in the Company’s operating partnership. The lawsuits were initiated following the Company’s announcement of the restatement of its financial results for the first three quarters of 2005.
Under the terms of the class action settlement, all claims against the Company and related defendants will be dismissed without admission or presumption of liability or wrongdoing. The settlement is contingent upon various conditions, including but not limited to, final approval by the Eastern District Court of Pennsylvania after notice to the class and a final court hearing.
The Company also reached final settlement in connection with litigation brought by certain unitholders in the Company’s operating partnership stemming from similar claims to those made under the Company’s class action litigation. All parties in this action have executed a final settlement and release agreement, under which the lawsuit has been dismissed with prejudice and a full release of the Company and all related defendants has been provided.
Commenting on the announcement, the Company’s General Counsel and Executive Vice President, Joseph Macchione, stated: “While we are confident that GMH had meritorious defenses to the claims made in both cases, we believe avoiding protracted litigation, expense and distraction is in the best interest of the Company and our shareholders. We are pleased to have settled these matters quickly and favorably, and we are glad to be closing this chapter in our history.”
The Company’s insurance carrier has agreed to pay a substantial portion of the settlement amounts and legal expenses related to the defense of both matters. The Company expects the net charges, inclusive of its contribution to the settlement amounts and legal expenses associated with defending the matters, will be approximately $2.2 million for the nine months ended September 30, 2007.
Additional information regarding these litigation matters will be included in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.
About GMH Communities Trust
GMH Communities Trust (www.gmhcommunities.com) is a publicly-traded Maryland real estate investment trust (REIT). We are a self-advised, self-managed, specialty housing company focused on providing housing to college and university students residing off-campus and to members of the U.S. military and their families residing on or near bases throughout the United States. GMH Communities also provides property management services to third-party owners of student housing properties, including colleges, universities, and other private owners. The Company, based in Newtown Square, PA, employs more than 2,300 people throughout the United States.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release that are based on our current expectations, estimates and projections about future events and financial trends affecting us are “forward-looking statements.” Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “expect,” “estimate” or other comparable terminology, including the anticipated timeframe by which financing for the project will be obtained. These statements are inherently subject to risks and uncertainties, including the project’s ability to obtain construction/development financing at all or on terms that are acceptable to the parties, as well as other risks relating to our business presented in our filings with the Securities and Exchange Commission. Forward-looking statements are made as of the date of this press release, and we undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information, future events or otherwise.
SOURCE GMH Communities Trust
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