SEC Comment Letter for REGIONAL HEALTH PROPERTIES, INC (RHEP, RHEPA, RHEPB, RHEPZ) (CIK 0001004724) (RHEP) — Aug 25, 2014
REGIONAL HEALTH PROPERTIES, INC (RHEP, RHEPA, RHEPB, RHEPZ) (CIK 0001004724)
Date: Aug. 25, 2014 · CIK: 0001004724 · Accession: 0000000000-14-042884
AI Filing Summary & Sentiment
Reasoning
Letter
August 25, 2014 Via E -mail Ronald W. Fleming Chief Financial Officer AdCare Health Systems, Inc. 1145 Hembree Road Roswell, GA 30076
Re: AdCare Health Systems, Inc. Preliminary Proxy Statement on Schedule 14A Filed August 15, 2014 File No. 000 -33135
Dear Mr. Fleming :
We have reviewed your filing an d have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure.
Please respond to this letter within ten business days by amending your filing, by providing the requested information, or by advising us when you will provide the requested response. If you do not believe our comments apply to your facts and circumstances or do not believe an amendment is appropriate, please t ell us why in your response.
After reviewing any amendment to your filing and the information you provide in response to these comments, we may have additional comments.
Background of the Decision to Transition the Company …, page 27
1. We note that you and your financial advisor, SunTrust Robinson Humphrey, engaged in several discussions and presentations with prospective buyers. We further note that certain prospective buyers may have expressed minimal or no interest in acquiring your operations. Please expand your disclosure to explain what you mean by “none of the prospective acquirers would fairly value our operations or our real estate or otherwise provide meaningful value to our shareholders.” Based on your disclosure, it appears some prospective buyers did express an interest in your busin ess as a whole. Please specifically discuss why you believe the value wa s inadequate. Lastly, please present financial analyses to support your decision to pursue the Additional Leasing Transactions strategy. We note your disclosure on page 29 indicatin g that your working group considered financial analyses and pro forma financial information.
Ronald W. Fleming AdCare Health Systems, Inc. August 25, 2014 Page 2
2. Please expand your disclosure to detail the status of your discussions with “certain regional third -party operators” to lease or sublease certain of your skilled nursing and assisted living facilities.
We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes the information the Securities Exchange Act of 1934 and all applicable Ex change Act rules require. Since the company and its management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made.
In responding to our comments, plea se provide a written statement from the company acknowledging that:
the company is responsible for the adequacy and accuracy of the disclosure in the filing;
staff comments or changes to disclosure in response to staff comments do not foreclose the Commi ssion from taking any action with respect to the filing; and
the company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
You may contact Emily Drazan, Attorney -Adviser, at (202) 551 -3208, or me at (202) 551-3810 if you have any questions.
Sincerely,
/s/ Celeste M. Murphy for
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August 25, 2014 Via E -mail Ronald W. Fleming Chief Financial Officer AdCare Health Systems, Inc. 1145 Hembree Road Roswell, GA 30076 Re: AdCare Health Systems, Inc. Preliminary Proxy Statement on Schedule 14A Filed August 15, 2014 File No. 000 -33135 Dear Mr. Fleming : We have reviewed your filing an d have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. Please respond to this letter within ten business days by amending your filing, by providing the requested information, or by advising us when you will provide the requested response. If you do not believe our comments apply to your facts and circumstances or do not believe an amendment is appropriate, please t ell us why in your response. After reviewing any amendment to your filing and the information you provide in response to these comments, we may have additional comments. Background of the Decision to Transition the Company …, page 27 1. We note that you and your financial advisor, SunTrust Robinson Humphrey, engaged in several discussions and presentations with prospective buyers. We further note that certain prospective buyers may have expressed minimal or no interest in acquiring your operations. Please expand your disclosure to explain what you mean by “none of the prospective acquirers would fairly value our operations or our real estate or otherwise provide meaningful value to our shareholders.” Based on your disclosure, it appears some prospective buyers did express an interest in your busin ess as a whole. Please specifically discuss why you believe the value wa s inadequate. Lastly, please present financial analyses to support your decision to pursue the Additional Leasing Transactions strategy. We note your disclosure on page 29 indicatin g that your working group considered financial analyses and pro forma financial information. Ronald W. Fleming AdCare Health Systems, Inc. August 25, 2014 Page 2 2. Please expand your disclosure to detail the status of your discussions with “certain regional third -party operators” to lease or sublease certain of your skilled nursing and assisted living facilities. We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes the information the Securities Exchange Act of 1934 and all applicable Ex change Act rules require. Since the company and its management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made. In responding to our comments, plea se provide a written statement from the company acknowledging that: the company is responsible for the adequacy and accuracy of the disclosure in the filing; staff comments or changes to disclosure in response to staff comments do not foreclose the Commi ssion from taking any action with respect to the filing; and the company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. You may contact Emily Drazan, Attorney -Adviser, at (202) 551 -3208, or me at (202) 551-3810 if you have any questions. Sincerely, /s/ Celeste M. Murphy for Larry Spirgel Assistant Director cc: Via E -mail Lori A. Gelchion Rogers & Hardin LLP