Sonida Senior Living, Inc 8-K, filed Feb 12, 2020
Sonida Senior Living, Inc. (SNDA)
About this 8-K
Sonida Senior Living, Inc filed this 8-K on February 12, 2020, reporting on events of February 11, 2020.
Items reported
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) February 11, 2020
Capital Senior Living Corporation
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
| 1-13445 | 75-2678809 | |
| (Commission File Number) | (IRS Employer Identification No.) | |
| 14160 Dallas Parkway Suite 300 Dallas, Texas |
75254 | |
| (Address of principal executive offices) | (Zip Code) | |
(972) 770-5600
(Registrant’s telephone number, including area code)
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading symbol(s) |
Name of each exchange on which registered | ||
| Common Stock, par value $0.01 per share | CSU | New York Stock Exchange |
Item 7.01 Regulation FD Disclosure.
On February 11, 2020, Capital Senior Living Corporation (the “Company”) announced that it has executed a binding letter agreement with Healthpeak Properties, Inc. (“Peak”) relating to certain properties leased by the Company from Peak. The full text of the press release issued in connection with the announcement is attached hereto as Exhibit 99.1.
By filing this Current Report on Form 8-K, the Company does not acknowledge that disclosure of this information is required by Regulation FD or that the information was material or non-public before the disclosure. The Company assumes no obligation to update or supplement forward-looking statements in this presentation that become untrue because of new information, subsequent events or otherwise.
The information being furnished under Item 7.01 and Exhibit 99.1 shall not be deemed “filed” for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such a filing. The press release contains, and may implicate, forward-looking statements regarding the Company and includes cautionary statements identifying important factors that could cause actual results to differ materially from those anticipated.
Item 9.01 Financial Statements and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Exhibits.
| * | These exhibits to this Current Report on Form 8-K are not being filed but are being furnished pursuant to Item 9.01. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: February 11, 2020 | Capital Senior Living Corporation | |||||
| By: | /s/ Carey P. Hendrickson | |||||
| Name: | Carey P. Hendrickson | |||||
| Title: | Executive Vice President and | |||||
| Chief Financial Officer | ||||||
Exhibit 99.1
| FOR IMMEDIATE RELEASE |
||
| Contact: | ||
| Carey Hendrickson, Chief Financial Officer 972-770-5600, chendrickson@capitalsenior.com |
CAPITAL SENIOR LIVING REDUCES LEASE LIABILITY AND IMPROVES CASH POSITION WITH
AGREEMENTS FOR EARLY TERMINATIONS OF HEALTHPEAK MASTER LEASES
COMBINED AGREEMENTS EXPECTED TO IMPROVE CASH POSITION APPROXIMATELY $6.0 MILLION AND REDUCE LEASE LIABILITY BY APPROXIMATELY $33.0 MILLION
DALLAS, February 11, 2020… Capital Senior Living (NYSE:CSU), one of the nation’s largest operators of senior living communities, announced today the Company has executed a binding agreement for early termination of its Healthpeak master lease scheduled to mature in April 2026. Effective February 1, the master lease, covering six communities (the “2026 Communities”), will convert to a RIDEA structure while Healthpeak markets those properties for sale. In November 2019, the Company announced that it had reached an agreement with Healthpeak for the early termination of nine communities in its master lease scheduled to mature in October 2020 (the “2020 Communities”).
Kimberly S. Lody, Capital Senior Living’s President and Chief Executive Officer, said, “This mutually beneficial agreement between Capital Senior Living and Healthpeak accelerates the strategic priorities of both companies. The early termination of both of our master leases with Healthpeak immediately reduces our lease exposure and improves our consolidated cash flow and liquidity. We appreciate the partnership we have had with Healthpeak, and look forward to smooth and efficient sales of these communities.”
Highlights of the Agreement
| • | Effective February 1, the Company’s master lease agreement related to the 2026 Communities will be terminated and converted to an interim management agreement under a RIDEA structure. |
| • | Healthpeak will immediately market the 2026 Communities for sale. The management agreements will terminate as each community is sold. |
| • | Capital Senior Living agrees to release approximately $1.9 million of security deposits held by Healthpeak. |
| • | When the 2020 Communities and 2026 Communities are fully transitioned, the Company expects its cash position to improve by approximately $6.0 million annually, and its lease liabilities will be reduced by approximately $33.0 million. |
| • | Upon completion of the sales of the 2020 and 2026 communities, Capital Senior Living will have no ongoing obligations with Healthpeak. |
Safe Harbor
The forward-looking statements in this release are subject to certain risks and uncertainties that could cause the Company’s actual results and financial condition to differ materially, including, but not limited to, the Company’s ability to generate sufficient cash flow to satisfy its debt and lease obligations and to fund the Company’s capital improvement projects to expand, redevelop, and/or reposition its senior living communities; the Company’s ability to obtain additional capital on terms acceptable to it; the Company’s ability to extend or refinance its existing debt as such debt matures; the Company’s compliance with its debt and lease agreements; the Company’s ability to complete acquisitions and dispositions upon favorable terms or at all; the risk of oversupply and increased competition in the markets which the Company operates; the risk of increased competition for skilled workers due to wage pressure and changes in regulatory requirements; the departure of the Company’s key officers and personnel; the cost and difficulty of complying with applicable licensure, legislative oversight, or regulatory changes; the risks associated with a decline in economic conditions generally; the adequacy and continued availability of the Company’s insurance policies and the Company’s ability to recover any losses it sustains under such policies; changes in accounting principles and interpretations; and the other risks and factors identified from time to time in the Company’s reports filed with the Securities and Exchange Commission.
About Capital Senior Living
Dallas-based Capital Senior Living Corporation is one of the nation’s largest operators of independent living, assisted living and memory care communities for senior adults. The Company’s 125 communities are home to more than 11,000 residents across 23 states and provide compassionate, resident-centric service and care as well as engaging programming. Capital Senior Living affords seniors the freedom and opportunity to successfully, comfortably and happily age in place. For more information, visit www.capitalsenior.com or connect with the company on Facebook.
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