SRZ:500,000 options to Neeb D Gregory at 1.37 per share

Options have been granted to Neeb D Gregory (Chief Investment Officer)

500,000 options at 1.37 per share vested in 3 equal installments (33.33%) on Dec 23,2009, 2010, 2011

Complete details here

SRZ:Form 10K Ammendment-year ending Dec 31,2007

SRZ has filed a 10K ammendment for Year ending Dec 31,2007.

as per the filings this is done as SRZ had notified that the following 3 ventures:
1. Sunrise Aston Gardens Venture LLC
2. PS Germany Investment (Jersey) LP and
3. Sunrise IV Senior Living Holdings, LLC)

10K info was missing in the original 10K for year ending Dec 31,2007. The SEC had requested that the documents should be ammended as soon as they are available... hence this filing.

- They have also included additional notes to the account(Note 24) regarding non compliance to certain convenants related to SRZ Bank Credit Facility. (already part of their Nov 7,2008 conference call)

- (Notes 2.1 and 11 of PS Germany Investment) Non compliance related to Bank Credit facility for Germany venture and the standstill agreement with Natixis. (already reported here in this blog )

The SEC filing information can directly be accessed here

SRZ: Gastrointestinal Virus outbreak in Dix Hill Assisted living facility

4 residents hospitalized, residents experienced nausea & diarrhea.
Grace Kelly-McGovern, a spokeswoman for the Suffolk Department of Health Services stated that the patients are doing fine.

Link to news out here

SRZ: 200,000 Options to Schwartz Daniel

Reported on Dec 29,2008: 200,000 options granted with 33.33% shares vested each year for 3 years on Dec 23,2009, 2010,2011

The actual document can be viewed here

SRZ: CFO,CAO Option Grants & German Assets Standstill Agreement

Sunrise Senior has filed new SEC Reports:

1. CFO (Chief Financial Officer) Richard Nadeau: Granted 750,000 stock options at 1.37 per share
2. CAO (Chief Accounting Officer) Pangelinan Julie Anne: Granted 500,000 stock options at 1.37 per share

These shares will be vested in 3 installments each of Dec 23, 2009,2010,2011 ie 33.33% of the shares will be vested each year.

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There is one additional SEC filing with regards to German Assets.

Sunrise Hannover Senior Living GmbH & Co (Property Owners)
Sunrise Hannover GmbH ( Operating Company)
NATIXIS, London Branch [Its a FUND not a bank] - lender

The SRZ affiliates and NATIXIS have agreed to have a 60 day Standstill Agreement (starting Dec 24,2008) and maximum end date of March 31,2009

NATIXIS due to past agreement is expected to receive 11,224,376 euros from SRZ due to some loan agreement standards Loan To Value (LTV) Threshold limits being breached..

***SRZ has provided some assurances stating that there are going to be some agreements in place with Bank of America NA and based on these findings NATIXIS and SRZ have entered into a Standstill Agreement wherein NATIXIS is not going to start implementing its clause to request for additional 11.2 million euros but NATIXIS will do nothing for the next 60 days..

So here we have it folk's.. our Jan 31,2009 (or earlier) seems to be the date for some major breakthrough news for SRZ with regards to funding and Bank of America is going to be one of the principal financiers

PNote: **** This is my interpretation of the SEC filings Please read the complete SEC filings here

SRZ: Funding Interest Rates

As per SRZ Sept08 Q3 Report the latest terms lending rates for SRZ are as follows:

As part of the November 6, 2008 amendment, the Company also paid fees of $0.2 million to the lenders and the borrowing cost under the line was increased to LIBOR plus 3.75 percent, with a minimum rate of 5 percent.

Current(Dec 23,2008) LIBOR rates are: (as per bankrate.com)

1 month Libor: 0.88 ---SRZ rate: 4.63% (5% Due to base rate of 5% minimum)
3 month Libor: 1.85 ---SRZ Rate: 5.6%
6 months Libor: 2.17---SRZ Rate: 5.92%
Call money: 2.00 ---SRZ Rate: 5.75%
1 Year Libor Rate: 2.09 ---SRZ Rate: 5.84

Still highest rates are 5.92% not much to talk about.. The Govt was asking for 9% from the automakers..

There are additional info regarding Tax Refunds (27 million) and 13.1 million in deposit refunds for 2009 out here

Strip Down valuation of SRZ (10USD)

Looking at the Emeritus Ventas Deal done today Dec 22,2008 :62.5 million for 432 units thats approximately (62.5 /432) = 144,676 USD per unit as sale price..

http://www.reuters.com/finance/stocks/keyDevelopments?symbol=VTR.N&timestamp=20081222201500&rpc=66

SRZ had 54,000 units 261 ownership and 178 managed ie (54,000/(261+178))*261 = 32,104 ownership interest units.

Considering the same rates as Emeritus deal (32,104*144676) = 4.64 Billion USD

Considering ownership interest as just 51% holding instead of 100% ie 0.51*4.64 =2.368Billion USD considering prevailing market rates.. (Dec 22,2008)

Considering all liabilities (1.292Billion) we still have (2.368 - 1.292) = 1.076 Billion USD as residual value

Even 50% off is 538million which is 8.59 times current value ie (8*1.22) = 10 USD per share..

This is just property .. not included is brand and other non tangible assets such as premier locations, market share and 178 managed property locations.

Already included is a 50% off and all liabilities have been payed off and ownership consideration of 51% instead of 100% value.

Thus the strip down value is 10USD for Sunrise Senior Living(SRZ)

SRZ: Update: Peek into 3rd Qtr Reports

Sunrise Senior Living share price (SRZ) Leaped with the 8 million refinancing deal stock moved from 75 cents to 2.2USD 193% jump.

The great part of the story is SRZ management had already declared that 8 million deal was in the pipeline for Q4 2008 in their Q3 2008 meeting

"potential refinancings related to the Company's ventures resulting in estimated net proceeds of $8 million projected to occur in the fourth quarter of 2008"

Let us look at if there are any such pleasant surprises hidden in the Q3 2008 reports.

• sale of 15 land parcels related to abandoned development project with a book value of $74 million and related debt of $31 million projected to occur throughout 2009;
• sales of properties that are currently wholly-owned to a venture with net proceeds of approximately $10 million projected during 2009
• successful completion of bond financing for non-profit development projects being developed by the Company's subsidiary Greystone, of which at least two are forecasted to close in late 2008 or early 2009, generating anticipated net proceeds of $11 million.

The way it looks to me:

- **sale of 15 land parcel is expected to be positive though proceeds of 43 million might not be possible maybe 30 million

- **Sale of property and 10 million proceeds likely.

- **Greystone funding looks unlikely.

**P.N.: These are my understanding/readings of Q3 report and not based on any information source.

Additional points dicovered are:

• Companies land purchase commitments are terminable by Sunrise and the $13.1 million in land deposits (included in other assets on the Company's consolidated balance sheet) are refundable.
• Additional tax refunds of up to $27 million are anticipated to be received by mid-2009, subject to the filing of the Company's tax returns for 2008

SRZ: Sunrise Senior living Strong Value Buy

NYSE:SRZ http://www.sunriseseniorliving.com/


Sunrise Senior Living, Inc. provides senior living services in the United States, Canada, the United Kingdom, and Germany. It offers independent living services, which include housing, meals, transportation, activities, and housekeeping, as well as licensed skilled nursing services for residents who require 24-hour skilled nursing care; and determination of the appropriate level of care and service for such resident.



(all values in US Dollars)

CMP: 1.36 (Dec 19,2008)
Market Cap: 69.31 Million
Sales 1.722Billion

- Company is the leading brand in Senior Assisted Living facilities.
- Company had accounting issues and has restated its accounts. Income statement has losses of 257.54 million (4 Qtr running Sept 2008)
- Refinancing of existing debt in one of its joint ventures with Ventas. (Dec 4,2008)
- 8.3 million profit for SRZ from refinancing.
- Refinancing was done for 10 year period Jan 2019 at 6.5% interest rate including costs,expenses and fees.
- Company has 441 communities under management with resident capacity of 54000 residents
- Company has communities in USA,Canada,UK and Germany.
- Favourable demographics growth Rate of 80+ citizens USA: 29%, Europe: 44%
- Average Daily rate in communities is 146 - 170 USD.
- High Average Occupancy rate 89 - 91%

- The past accounting problems and the current liquidity problems are already reflected in the share price of the company.

- 95% holding by institutions and high networth individuals



The company stock is available at firesale price. The senior care industry is a growing industry with favourable demographics. Company is in the high end of senior care and has strong brand recognition.
1-2 years the stock price target is 35USD a 2573% appreciation for current level.

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Nov 13,2008: SRZ CEO Mark Ordan alloted 1.5 million shares at 92 cents per share with a 10 year life span. Options expire on Nov 13,2018. Date Reported to SEC: Nov 17,2008
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NYSE Trading details: 19Dec 2008 :
Retail Trading Details: Buy : 3,800 Sell: 2,201
Program Trading: Index Arbitrage: 78,043
The SRZ stock is already out of the Small Cap Index.. looks like the NYSE or some other traders have not made a change in their list of index stocks in their software configuration which is resulting in Index Arbitrage trading on this stock.
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S&P has released new Report on SRZ on Dec 20,2008 as per Yahoo finance
http://finance.yahoo.com/q?s=srz
or
(pay 35 USD) http://reports.finance.yahoo.com/w0?r=34666101:1
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Please See Q1 2008 Investor presentation by Sunrise SRZ:
http://library.corporate-ir.net/library/11/115/115860/items/294758/SRZQ1-08%20InvestorPresentationupdatednoSN.pdf

This will provide details such as room rates, occupancy levels etc
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Sunrise Property UK Video:

http://www.sunriseproperty.co.uk/why-we-win.asp

It is basically for people who want to invest in property market with sunrise or have property in good locations for sunrise to develop them as senior living premises. It does provide some additional info about the company and its properties.. SRZ property in UK have won architecture awards for their designs.. all this and more at the above link.
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The stocks are being held by few players look at the SEC Filings:
Date: Dec 4,2008:
Weiss Multi-Strategy Advisers LLC: 4,800,000 shares
George A. Weiss: 4,800,000 shares
Frederick E. Doucette III: 4,800,000 shares
Weiss Multi-Strategy Partners LLC: 2,554,006

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Date:Nov 20,2008:
Soundpost Partners, LP - 5,016,350
Jaime Lester - 5,016,350

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Nov 7,2008:
RS Value Fund : 3,712,784
RS Investment Management Co. LLC : 6,042,298
Guardian Investor Services LLC : 6,042,298
The Guardian Life Insurance Company of America: 6,042,298

So you have it here : 48,826,384 (48.826 million shares are in strong hands..)
you can confirm the data from this url
http://secfilings.nyse.com/files.php?symbol=SRZ
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Short Interest in SRZ:
- Dec 2008: 5 million.
- Nov 2008: 5 million.
- Oct 2008: 6.7million.
- Sept 2008: 8.3million.
- Aug 2008: 8.7million.
So there was heavy shorting much before the results were out and they are slowly being reduced. With the new Fed funds rate of 0.0 to 0.25 you can expect atleast good corporations in a position to get loans/financing terms.
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Mark S Ordan : Current CEO of Sunrise Senior Living is known to be a turnaround KID:

http://www.washingtonpost.com/wp-dyn/content/article/2007/04/13/AR2007041302045.html

with 1.5 million options he is all set to turn around SRZ also..
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Here is another article about Senior Living companies with reference to Sunrise
http://www.nytimes.com/2008/11/26/business/26senior.html?pagewanted=1&_r=1
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Another article on Sunrise: It chronicles the past and does give almost the full public picture with regards to Sunrise.

Generally more news in the market is a good thing at it sets the stage for a move in the company stock (SRZ) in one direction or another ..
http://www.washingtonpost.com/wp-dyn/content/article/2008/12/21/AR2008122101922.html

We are close to D day Jan 31 when the company should come out with new details about financing and the stock will move up for sure. The news will be available much before jan 31 so don't wanit for the last day..
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Dec 22,2008: Chief Operating Officer Moving to head European Operations
http://sev.prnewswire.com/health-care-hospitals/20081222/PH5412422122008-1.html
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Dec 22,2008: Strip down SRZ valuations considering the ventas emeritus deal : 10 USD per share
http://www.reuters.com/finance/stocks/keyDevelopments?symbol=VTR.N&timestamp=20081222201500&rpc=66


Looking at the Emeritus Ventas Deal :
62.5 million for 432 units thats approximately 144,676 USD per unit as sale price..

• SRZ had 54,000 units 261 ownership and 178 managed ie (54,000/(261+178))*261 = 32,104 ownership interest units.
• Considering the same rates as Emeritus deal (32,104*144676) = 4.64 Billion USD
• Considering ownership interest as 51% holding ie 0.51*4.64 =2.368Billion USD considering prevailing market rates.. (Dec 22,2008)
• Considering all liabilities 1.292Billion we still have (2.368 - 1.292) = 1.076 Billion USD as residual value
• Even 50% off is 538million which is 8.59 times current value ie (8*1.22) = 10 USD per share..
• This is just property .. not included is brand and other not tangible assets such as premier locations, market share and 178 managed property locations (with residual stake)
• Already included is 50% off and all liabilities have been paid off.

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