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Offer to Purchase for Cash
Up to 10,000,000 Shares of Common Stock
of
Five Star Quality Care, Inc.
at
$3.00 Net Per Share
by
ABP Acquisition LLC
a wholly owned subsidiary of
ABP Trust
THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, NOVEMBER 10, 2016, UNLESS THE OFFER IS EXTENDED.
October 6, 2016
To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees:
We have been engaged by ABP Acquisition LLC, a Maryland limited liability company ("Purchaser"), to act as the information agent ("Information Agent") in connection with Purchaser's offer to purchase up to 10,000,000 shares of common stock, par value $.01 per share ("Shares"), of Five Star Quality Care, Inc., a Maryland corporation ("FVE"), for $3.00 per share, net to the seller in cash, without interest and less any required withholding taxes, upon the terms and subject to the conditions set forth in the Offer to Purchase dated October 6, 2016 (as it may be amended or supplemented from time to time, the "Offer to Purchase") and the related Letter of Transmittal (as it may be amended or supplemented from time to time, the "Letter of Transmittal" and, together with the Offer to Purchase, the "Offer") enclosed herewith.
As of October 4, 2016, there were 49,519,051 outstanding Shares. Purchaser is a wholly owned subsidiary of ABP Trust, a Maryland statutory trust ("ABP Trust"), owned by Barry M. Portnoy (a managing director of FVE) and Adam D. Portnoy. ABP Trust is the controlling stockholder of The RMR Group Inc., a Maryland corporation ("RMR Inc."), whose shares of class A common stock are listed on The NASDAQ Stock Market LLC. RMR Inc. is the managing member of The RMR Group LLC, a Maryland limited liability company ("RMR LLC"), which provides management services to FVE. ABP Trust owns, directly and indirectly, an approximate 51.8% economic interest in RMR LLC.
If more than 10,000,000 Shares are properly tendered and not withdrawn, Purchaser will purchase Shares properly tendered and not withdrawn on a pro rata basis with adjustments to avoid the purchase of fractional Shares.
Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Shares registered in your name or in the name of your nominee.
Enclosed for your information and forwarding to your clients for whose accounts you hold Shares registered in your name or in the name of your nominee are copies of the following documents:
- 1.
- The Offer to Purchase.
- 2.
- The related Letter of Transmittal for your use in accepting the Offer and tendering Shares registered in your name or in the name of your nominee on the books of FVE maintained by FVE's registrar and transfer agent and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender Shares.
- 3.
- A letter that may be sent to your clients for whose accounts you hold Shares registered in your name or in the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Offer.
- 4.
- FVE's Schedule 14D-9 dated October 6, 2016 (the "Schedule 14D-9").
- 5.
- An Internal Revenue Service Form W-9.
- 6.
- A return envelope addressed to Wells Fargo Bank, N.A., the depositary and paying agent for the Offer (the "Depositary") to be used to return the letter of transmittal for registered Shares.
YOUR PROMPT ACTION IS REQUIRED. PLEASE CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 10, 2016, UNLESS THE OFFER IS EXTENDED.
We have been advised that FVE's board of directors is expressing no opinion to FVE's stockholders on, and is remaining neutral toward, the Offer in the Schedule 14D-9. None of Purchaser, ABP Trust, Barry M. Portnoy, Adam D. Portnoy, Wells Fargo Bank, N.A., in its capacity as the Depositary or Morrow Sodali Global LLC in its capacity as Information Agent, make any recommendation as to whether to tender or refrain from tendering Shares and have not authorized any person to make any such recommendation.
The Offer is not conditioned upon obtaining financing or any minimum number of Shares being tendered. However, the Offer is subject to other conditions. A summary of the principal terms of the Offer, including such conditions, are described in Sections 1 and 13 of the Offer to Purchase. Purchaser reserves the right to waive any of the conditions to the Offer and to make any change in the terms of, or conditions to, the Offer.
Purchaser will not pay any fees or commissions to any broker, dealer or any other person (other than to the Information Agent and the Depositary as described in the Offer to Purchase) for soliciting tenders of Shares pursuant to the Offer. Purchaser will, however, upon request, reimburse brokers, dealers, commercial banks, trust companies and other nominees for reasonable and necessary costs and expenses incurred by them in forwarding the enclosed materials to their clients.
Purchaser will pay all stock transfer taxes applicable to its purchase of Shares pursuant to the Offer, subject to Instruction 6 of the Letter of Transmittal.
In order to tender Shares in the Offer, a duly executed and properly completed Letter of Transmittal (or a manually signed copy thereof), or an agent's message (as described in the Offer to Purchase) in connection with a book-entry transfer of Shares held in a book-entry transfer facility, and any other required documents, must be sent to the Depositary, and certificates representing the tendered Shares should be delivered or such Shares must be tendered by book-entry transfer, all in accordance with the instructions contained in the Letter of Transmittal and the Offer to Purchase.
Any questions regarding the Offer should be addressed to, and additional copies of the enclosed materials may be obtained from, the Information Agent at the addresses and telephone numbers set forth on the back cover of the Offer to Purchase.
Very truly yours, | ||
Morrow Sodali Global LLC |
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU THE AGENT OF PURCHASER, THE INFORMATION AGENT OR THE DEPOSITARY, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
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