CNL LIFESTYLE PROPERTIES, INC. (OTCMKTS:CLLY) Files An 8-K Regulation FD Disclosure
Item7.01
| Regulation FD Disclosure |
Filed as Exhibit99.1 to this Current Report on Form 8-K, and
incorporated by reference in this Item7.01, is the text of a
correspondence from CNL Life>
to the rules and regulations of the Securities and Exchange
Commission (the SEC), the information contained in this Item7.01,
including Exhibit 99.1 and information set forth therein, is
deemed to have been furnished and shall not be deemed to be filed
under the Securities Exchange Act of 1934, as amended (the
Exchange Act), or otherwise subject to the liabilities of the
Exchange Act, nor shall any of such information be deemed
incorporated by reference in any filing under the Securities Act
of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such a filing.
By furnishing the information contained in this Item7.01
disclosure, including Exhibit 99.1, the Company makes no
admission as to the materiality of such information.
| Item8.01 | Other Events. |
Determination of Estimated Net Asset Value Per Share as
of November30, 2016
As previously reported in the Companys Current Report on Form 8-K
filed with the SEC on November2, 2016 (the November2, 2016 8-K),
the Company entered into a Purchase and Sale Agreement dated as
of November2, 2016 with EPR Properties, a Maryland real estate
investment trust (EPR), and Ski Resort Holdings LLC, a Delaware
limited liability company owned by funds affiliated with Och-Ziff
Real Estate, for the sale of all of the Companys remaining
properties for an aggregate purchase price of $830 million (the
Sale Agreement). Also as previously reported in the November2,
2016 8-K, on November1, 2016 the Board approved a plan of
liquidation and dissolution (the Plan of Dissolution), subject to
stockholder approval, to liquidate and dissolve the Company and
to distribute the net proceeds thereof (including amounts
received under the Sale Agreement) to stockholders and declared a
special distribution in the amount of $0.50 per share payable to
the holders of record of the Companys common stock as of the
close of business on November1, 2016 (the Special Distribution).
The Special Distribution, which was paid on or about November14,
2016, totaled approximately $163 million.
The Company prepares and announces an estimated net asset value
per share of its common stock and provides such information to
its stockholders and to members of the Financial Industry
Regulatory Authority (FINRA) and their associated persons who
participated in the Companys public offerings to assist them in
meeting their customer account statement reporting obligations
under National Association of Securities Dealers Conduct Rule
2340. The Companys most recent estimated NAV determination was
$3.05 per share as of December31, 2015. In light of the
announcement of the Sale Agreement and the payment of the Special
Distribution, the Board has determined to calculate and announce
a new estimated NAV as of November30, 2016 after taking into
account those developments.
To assist the Board and the Companys valuation committee, which
is comprised solely of the Companys independent directors (the
Valuation Committee), in establishing a new estimated NAV per
share of the Companys common stock as of November30, 2016 (the
Valuation Date), CNL Life>
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The Advisor provided the Valuation Analysis to the Valuation
Committee and the Board. As of the Valuation Date, the Companys
investment portfolio consisted of interests in 36 properties: 16
ski and mountain life>
| – | the Sale Agreement; |
| – |
the Companys balance sheet as of September30, 2016, as adjusted for estimated contingencies, costs and operations based on a closing date under the Sale Agreement as of March31, 2017 and the Companys liquidation and dissolution by year end 2017; and |
| – | the Companys reports filed with the SEC. |
The Valuation Committee and the Board reviewed the Valuation
Analysis and considered the material assumptions relating
thereto. Upon due consideration, on December5, 2016, the
Valuation Committee recommended to the Board an estimated NAV as
of November30, 2016 of $2.10 per share of Company common stock,
which amount represents the low end of the range announced by the
Company in the November2, 2016 8-K as its estimate of the amount
to be received by stockholders in connection with the Plan of
Dissolution, after receipt of the Special Distribution.
Thereafter, at a special meeting of the Board, which was also
held on December5, 2016, the Board accepted the recommendation of
the Valuation Committee and unanimously approved $2.10 as the
estimated NAV per share of the Companys common stock based on a
share count of 325,182,969 shares issued and outstanding as of
November30, 2016 (the 2016 NAV).
The 2016 NAV deviates from the Companys valuation policy which
requires valuation as of December31 each year and from the
recommendations and methodologies of the Investment Program
Association, a trade association for non-listed direct investment
vehicles (IPA), as set forth in IPA Practice Guideline 2013-01
Valuations of Publicly Registered Non-Listed REITs, by including
estimated costs and fees to consummate the transactions under the
Sale Agreement and the Companys liquidation and dissolution. The
2016 NAV is an Advisor-led interim valuation based on the
execution of the Sale Agreement and related events.
The following table summarizes the material components of the
Companys NAV estimates as of December31, 2015 and November30,
2016 and provides a comparison of such value and the components
thereof. Wholly-owned asset values are based on the aggregate
purchase price under the Sale Agreement, and wholly-owned and
partially-owned asset values also reflect the Companys adjusted
balance sheet as of September30, 2016, which includes asset
dispositions year-to-date with an aggregate sales price of $158.2
million. In addition adjustments were made to reflect the Special
Distribution as well as estimated transaction fees, liquidation
costs, holdbacks and reserves based on an estimated closing date
of March31, 2017 and the Companys liquidation and dissolution
prior to the end of 2017.
Table of Value Estimates for Components of Net Asset
Value
| Value($in000s) 12/31/15 | Per Share | Value($000s) 11/30/16 | Per Share | |||||||||||||
|
Wholly-Owned Assets |
$ | 982,400 | $ | 3.02 | $ | 830,000 | $ | 2.55 | ||||||||
|
Partially-Owned Assets |
103,000 | 0.32 | 0.00 | |||||||||||||
|
Cash |
112,976 | 0.35 | 62,716 | 0.19 | ||||||||||||
|
Accounts Receivables and Other Assets |
40,146 | 0.12 | 16,173 | 0.05 | ||||||||||||
|
Mortgages and Other Notes Receivable |
0.00 | 0.00 | ||||||||||||||
|
Fair Market Value of Debt |
(185,418 | ) | (0.57 | ) | (143,806 | ) | (0.44 | ) | ||||||||
|
Accounts Payable and Other Liabilities |
(27,243 | ) | (0.08 | ) | (38,710 | ) | (0.12 | ) | ||||||||
|
Total |
$ | 1,025,861 | 3.15 | $ | 726,375 | $ | 2.23 | |||||||||
|
Less: Estimated Transaction Fees/Liquidation |
(34,000 | ) | (0.10 | ) | (43,488 | ) | (0.13 | ) | ||||||||
|
Net Asset Value |
$ | 991,861 | $ | 3.05 | $ | 682,887 | $ | 2.10 |
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The 2016 NAV, which is based on the total amount estimated to be
distributed to stockholders upon final liquidation and
dissolution of the Company to the Plan of Dissolution, is less
than the 2015 NAV. The principal factors contributing to a lower
2016 NAV are asset-based adjustments resulting from the extended
sales process and negotiations, a challenging 2015/2016 ski
season, and unforeseen capital investment requirements at certain
Properties. The 2016 NAV is based on a number of assumptions
including consummation of the transactions contemplated by the
Sale Agreement and are susceptible to uncertainty and changes in
circumstances.
Any material change in such information, circumstances and/or
conditions may have a material effect on the Companys 2016 NAV.
Communications with Stockholders
A copy of the correspondence to the Companys stockholders
regarding the 2016 NAV (the Letter to Stockholders) is filed with
this CurrentReport as Exhibit99.2 and is incorporated herein by
reference. The Letter to Stockholders will be posted on the
Companys website at www.cnllife>
| Item9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits |
| 99.1 |
Text of correspondence from the Company to financial advisors and broker dealers regarding the 2016 NAV. |
| 99.2 | Text of the Letter to Stockholders dated December 6, 2016. |
Caution Concerning Forward-Looking Statements
Statements in this Current Report on Form 8-K that are not
statements of historical or fact, including statements about the
purported value of the Companys common stock, may constitute
forward-looking statements within the meaning of the Federal
Private Securities Litigation Reform Act of 1995. The Company
intends that such forward-looking statements, including
statements regarding the Valuation Report, be subject to the safe
harbors created by Section21E of the Securities Exchange Act of
1934, as amended. Forward-looking statements are statements that
do not relate strictly to historical or current facts, but
reflect managements current understandings, intentions, beliefs,
plans, expectations, assumptions and/or predictions regarding the
future of the Companys business and its performance, statements
of future economic performance, and other future conditions and
forecasts of future events, and circumstances. Forward-looking
statements are typically identified by words such as believes,
expects, anticipates, intends, estimates, plans, continues, pro
forma, may, will, seeks, should and could, and words and terms of
similar substance in connection with discussions of future
operating or financial performance, business strategy and
portfolios, projected growth prospects, cash flows, costs and
financing needs, legal proceedings, amount and timing of
anticipated future distributions, estimated per share net asset
value of the Companys common stock, and/or other matters. The
Companys forward-looking statements are not guarantees of future
performance. While the Companys management believes its
forward-looking statements are reasonable, such statements are
inherently susceptible to uncertainty and changes in
circumstances. As with any projection or forecast,
forward-looking statements are necessarily dependent on
assumptions, data and/or methods that may be incorrect or
imprecise, and may not be realized. The Companys forward-looking
statements are based on managements current expectations and a
variety of risks, uncertainties and other factors, many of which
are beyond the Companys inability to control or accurately
predict. Although the Company believes that the expectations
reflected in such forward-looking statements are based upon
reasonable assumptions, the Companys actual results could differ
materially from those set forth in the forward-looking statements
due to a variety of risks, uncertainties and other factors. Given
these uncertainties, the Company cautions you not to place undue
reliance on such statements.
For further information regarding risks and uncertainties
associated with the Companys business, and important factors that
could cause the Companys actual results to vary materially from
those expressed or implied in its forward-looking statements,
please refer to the factors listed and described under
Managements Discussion and Analysis of Financial Condition and
Results of Operations and the Risk Factors sections of the
Companys documents filed from time to time with the SEC,
including, but not limited to, the Companys quarterly reports on
Form 10-Q, and the Companys annual report on Form 10-K, copies of
which may be obtained from the Companys website at
http://www.cnllife>
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All written and oral forward-looking statements attributable to
the Company or persons acting on its behalf are qualified in
their entirety by these cautionary statements. Forward-looking
statements speak only as of the date on which they are made, and
the Company undertakes no obligation to, and expressly disclaims
any obligation to, update or revise its forward-looking
statements to reflect new information, changed assumptions, the
occurrence of subsequent events, or changes to future operating
results over time, unless otherwise required by law.
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About CNL LIFESTYLE PROPERTIES, INC. (OTCMKTS:CLLY)
CNL Lifestyle Properties, Inc. is a real estate investment trust. The Company invests in and owns a diversified portfolio of real estate. The Company’s operating partnership is CLP Partners, LP, which conducts its operations and owns its assets. CNL Lifestyle Advisor Corporation provides management, acquisition, disposition, advisory and administrative services to the Company. It has investments in lifestyle properties in the United States. The Company’s properties include Brighton Ski Resort in Brighton, Utah; Crested Butte Mountain Resort in Mt. Crested Butte, Colorado; Gatlinburg Sky Lift in Gatlinburg, Tennessee; Jiminy Peak Mountain Resort in Hancock, Massachusetts; Loon Mountain Resort in Lincoln, New Hampshire; Hawaiian Falls-The Colony in The Colony, Texas; Pacific Park in Santa Monica, California; Waterworld in Concord, California; White Water Bay in Oklahoma City, Oklahoma; Anacapa Isle Marina in Oxnard, California, and Cabrillo Isle Marina in San Diego, California. CNL LIFESTYLE PROPERTIES, INC. (OTCMKTS:CLLY) Recent Trading Information
CNL LIFESTYLE PROPERTIES, INC. (OTCMKTS:CLLY) closed its last trading session 00.00 at 1.65 with 6,283 shares trading hands.