NASHVILLE, Tenn., July 16, 2019 /PRNewswire/ -- Brookdale Senior
Living Inc. (NYSE: BKD) ("Brookdale" or the "Company") today issued
the following statement:
At Brookdale, we appreciate and value constructive feedback from
investors, and remain open to engaging with all of our
shareholders, including Land & Buildings. Members of the
Company's Board of Directors and senior management team have held
numerous discussions with Land & Buildings over the last
several years. In July 2017, at the
recommendation of Land & Buildings, Brookdale appointed
Marcus Bromley, a candidate with
substantial real estate experience, as an independent director and
a member of the Audit Committee and the Investment Committee of the
Board.
Investment Committee Actions
As announced earlier this year, the three-member Investment
Committee carefully evaluated the potential of separating all, or a
portion, of the Company's real estate from our operations into a
new public REIT structure, commonly referred to as an OpCo/PropCo
transaction. The Investment Committee, which includes two
independent directors appointed to the Board as a result of
shareholder recommendations, undertook this review, with the
assistance of a leading independent advisory firm recommended by
Land & Buildings, with an open mind and a mandate to determine
whether a range of potential OpCo/PropCo structures could unlock
value for Brookdale shareholders. Based on this review, and as
discussed in our February 2019
earnings call, we determined, at the unanimous recommendation of
the Investment Committee and with the agreement of the advisory
firm, that undertaking an OpCo/PropCo transaction would be unlikely
to generate additional value for Brookdale shareholders. Brookdale
determined that a separation would result in an operating company
with uncertain viability and a single-operator PropCo REIT that is
unlikely to trade well in the market, due to key structural
deficiencies.
Operational and Governance Actions
We are committed to continually improving our performance and
corporate governance, and working to drive long-term, sustainable
shareholder value.
- The Company's business and operating performance has improved,
and we are providing quality service and care to residents and
patients. We appointed Cindy Baier
as President and Chief Executive Officer, as well as appointed two
additional new independent directors to the Board with deep
financial, health care and executive experience. Under this new
team's leadership, Brookdale's turnaround strategy is driving
results and the Company recently delivered solid first quarter 2019
earnings.
- The Board has undergone substantial refreshment in recent
years. Following the 2019 Annual Meeting of Shareholders (the "2019
Annual Meeting") only one of our directors will have more than five
years of tenure.
- In 2018, following discussions with Brookdale shareholders, the
Board unanimously decided to phase out the classified Board
structure beginning at the 2019 Annual Meeting of Shareholders (the
"2019 Annual Meeting"), which was approved by shareholders. The
Board subsequently recommended that this process of
declassification be accelerated, after considering further input
from shareholders earlier this year. As a result, at the 2019
Annual Meeting, Brookdale will be recommending that shareholders
approve an amendment to its Certificate of Incorporation so that
this year's nominees will be elected for one-year terms. By the
2021 Annual Meeting of Shareholders, each Brookdale director will
be elected annually, and if the accelerated declassification
amendment is approved by shareholders, a majority of the Board will
be up for election at the 2020 Annual Meeting of Shareholders.
- The Board recommended and successfully passed an amendment at
the 2018 Annual Meeting of Shareholders to reduce the voting
standard for removal of directors by shareholders.
- In May 2019, the Board of
Directors approved two additional corporate governance enhancements
to amend the Company's bylaws to implement proxy access and adopt a
majority voting standard in uncontested elections of directors, the
latter of which is subject to shareholder approval at the 2019
Annual Meeting.
Consistent with established processes, Brookdale's Nominating
and Corporate Governance Committee will continue to evaluate Land
& Buildings' nominees and make a recommendation to the Board in
due course. The entire Nominating and Corporate Governance
Committee has previously met with Mr. Litt and is in the process of
reviewing background information on Land & Buildings'
nominees. Brookdale shareholders do not need to take any
action at this time.
About Brookdale Senior Living
Brookdale Senior Living Inc. is the leading operator of senior
living communities throughout the United
States. The Company is committed to providing senior living
solutions primarily within properties that are designed,
purpose-built, and operated to provide the highest-quality service,
care, and living accommodations for residents. Brookdale operates
and manages independent living, assisted living, memory care, and
continuing care retirement communities, with 844 communities in 45
states and the ability to serve approximately 80,000 residents and
20,000 patients as of March 31, 2019.
The Company also offers a range of home health, hospice, and
outpatient therapy services. Brookdale's stock is traded on the New
York Stock Exchange under the ticker symbol BKD.
Safe Harbor
Certain statements in this press release may constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to various risks and uncertainties and
include all statements that are not historical statements of fact
and those regarding our intent, belief or expectations, including,
but not limited to, statements relating to the execution on our
strategic objectives. Forward-looking statements are generally
identifiable by use of forward-looking terminology such as "may,"
"will," "should," "could," "would," "potential," "intend,"
"expect," "endeavor," "seek," "anticipate," "estimate,"
"overestimate," "underestimate," "believe," "project," "predict,"
"continue," "plan," "target" or other similar words or expressions.
These forward looking statements are based on certain assumptions
and expectations, and our ability to predict results or the actual
effect of future plans or strategies is inherently uncertain.
Although we believe that expectations reflected in any
forward-looking statements are based on reasonable assumptions, we
can give no assurance that our expectations will be attained and
actual results and performance could differ materially from those
projected. Factors which could have a material adverse effect on
the Company's operations and future prospects or which could cause
events or circumstances to differ from the forward-looking
statements include, but are not limited to, events which adversely
affect the ability of seniors to afford resident fees and entrance
fees, including downturns in the economy, national or local housing
markets, consumer confidence or the equity markets and unemployment
among family members; changes in reimbursement rates, methods or
timing under governmental reimbursement programs including the
Medicare and Medicaid programs; the impact of ongoing healthcare
reform efforts; the effects of continued new senior housing
construction and development, oversupply and increased competition;
disruptions in the financial markets that affect the Company's
ability to obtain financing or extend or refinance debt as it
matures and the Company's financing costs; the risks associated
with current global economic conditions and general economic
factors such as inflation, the consumer price index, commodity
costs, fuel and other energy costs, interest rates and tax rates;
the Company's ability to generate sufficient cash flow to cover
required interest and long-term lease payments and to fund its
planned capital projects; the effect of the Company's indebtedness
and long-term leases on its liquidity; the effect of the Company's
non-compliance with any of its debt or lease agreements (including
the financial covenants contained therein), including the risk of
lenders or lessors declaring a cross default in the event of the
Company's non-compliance with any such agreements and the risk of
loss of the Company's property securing leases and indebtedness due
to any resulting lease terminations and foreclosure actions; the
effect of the Company's borrowing base calculations and the
Company's consolidated fixed charge coverage ratio on availability
under its revolving credit facility; increased competition for or a
shortage of personnel, wage pressures resulting from increased
competition, low unemployment levels, minimum wage increases and
changes in overtime laws, and union activity; failure to maintain
the security and functionality of the Company's information systems
or to prevent a cybersecurity attack or breach; the Company's
ability to complete pending or expected disposition or other
transactions on agreed upon terms or at all, including in respect
of the satisfaction of closing conditions, the risk that regulatory
approvals are not obtained or are subject to unanticipated
conditions, and uncertainties as to the timing of closing, and the
Company's ability to identify and pursue any such opportunities in
the future; the Company's ability to obtain additional capital on
terms acceptable to it; the Company's ability to complete its
capital expenditures in accordance with its plans; the Company's
ability to identify and pursue development, investment and
acquisition opportunities and its ability to successfully integrate
acquisitions; competition for the acquisition of assets; delays in
obtaining regulatory approvals; risks associated with the lifecare
benefits offered to residents of certain of the Company's entrance
fee CCRCs; terminations, early or otherwise, or non-renewal of
management agreements; conditions of housing markets, regulatory
changes and acts of nature in geographic areas where the Company is
concentrated; terminations of the Company's resident agreements and
vacancies in the living spaces it leases; departures of key
officers and potential disruption caused by changes in management;
risks related to the implementation of the Company's strategy,
including initiatives undertaken to execute on its strategic
priorities and their effect on the Company's results; actions of
activist stockholders; market conditions and capital allocation
decisions that may influence the Company's determination from time
to time whether to purchase any shares under its existing share
repurchase program and the Company's ability to fund any
repurchases; the Company's ability to maintain consistent quality
control; a decrease in the overall demand for senior housing;
environmental contamination at any of the Company's communities;
failure to comply with existing environmental laws; an adverse
determination or resolution of complaints filed against the
Company; the cost and difficulty of complying with increasing and
evolving regulation; costs to respond to, and adverse
determinations resulting from, government reviews, audits and
investigations; unanticipated costs to comply with legislative or
regulatory developments; as well as other risks detailed from time
to time in our filings with the Securities and Exchange Commission
(the "SEC"), including those contained in the Company's Annual
Report on Form10-K and Quarterly Reports on Form 10-Q. When
considering forward-looking statements, you should keep in mind the
risk factors and other cautionary statements in such SEC filings.
Readers are cautioned not to place undue reliance on any of these
forward-looking statements, which reflect our management's views as
of the date of this press release. The Company cannot guarantee
future results, levels of activity, performance or achievements,
and it expressly disclaims any obligation to release publicly any
updates or revisions to any forward-looking statements contained
herein to reflect any change in our expectations with regard
thereto or change in events, conditions or circumstances on which
any statement is based.
Important Additional Information and Where to Find It
The Company, its directors and certain of its executive officers
and employees may be deemed to be participants in the solicitation
of proxies from stockholders in connection with the 2019 Annual
Meeting. The Company plans to file a proxy statement with the SEC
in connection with the solicitation of proxies for the 2019 Annual
Meeting (the "2019 Proxy Statement"), together with a WHITE proxy
card. STOCKHOLDERS ARE URGED TO READ THE 2019 PROXY STATEMENT
(INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER
RELEVANT DOCUMENTS THAT THE COMPANY WILL FILE WITH THE SEC
CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION. Additional information
regarding the identity of these potential participants, none of
whom owns in excess of one percent (1%) of the Company's shares,
and their direct or indirect interests, by security holdings or
otherwise, will be set forth in the 2019 Proxy Statement and other
materials to be filed with the SEC in connection with the 2019
Annual Meeting. Information relating to the foregoing can also be
found in the Company's Amendment No. 1 to its Annual Report on Form
10-K for the year ended December 31,
2018, filed with the SEC on April 29,
2019 (the "10-K/A"). To the extent holdings of the Company's
securities by such potential participants (or the identity of such
participants) have changed since the information printed in the
10-K/A, such information has been or will be reflected on
Statements of Ownership and Change in Ownership on Forms 3 and 4
filed with the SEC.
Stockholders will be able to obtain, free of charge, copies of
the 2019 Proxy Statement, any amendments or supplements thereto and
any other documents (including the WHITE proxy card) when filed by
the Company with the SEC in connection with the 2019 Annual Meeting
at the SEC's website (http://www.sec.gov), at the Company's website
(http://www.brookdale.com/investor) or by contacting Chad C. White by phone at (615) 221-2250, by
email at cwhite@brookdale.com or by mail at Brookdale Senior Living
Inc., Attention: Chad C. White,
Executive Vice President, General Counsel and Secretary, 111
Westwood Place, Suite 400, Brentwood,
Tennessee 37027.
View original
content:http://www.prnewswire.com/news-releases/brookdale-comments-on-land--buildings-letter-300886112.html
SOURCE Brookdale Senior Living Inc.