Score another win for Corvex/Related in its battle with CommonWealth REIT (CWH) management as CommonWealth announces a restructuring of its management agreement with RMR along with several governance changes.
Beginning in 2014, the base management fee paid to RMR will now be more closely aligned with Commonwealth's stock price, rather than the value of real estate assets held. Also beginning in 2014, 10% of the base management fee will be paid not in cash, but in shares of CWH.
The size of the CWH board will be increased from its current 5 in order to bring the ratio of Independent members up to 75% from 60%. The board is also recommending annual election of trustees. Finally, the board will accelerate the expiration of the poison pill (currently set to expire on October 17).
Shares +1.5% premarket.