HOUSTON, Oct. 1, 2021 /PRNewswire/ -- Luby's, Inc.
(NYSE: LUB) ("Luby's"), which is in the process of monetizing its
assets for the benefit of its shareholders, announced today that it
has completed its previously announced sale of 26 real estate
properties to STORE Capital for $88,000,000.
Luby's utilized a portion of the proceeds from this sale and
previous sales to repay its senior lender, MSD PCOF Partners VI,
LLC, in full.
Updated Estimate of Net Assets in Liquidation under the
Liquidation Basis of Accounting
As a result of Luby's shareholder approval of its plan of
liquidation on November 17, 2020,
effective November 19, 2020, in
accordance with Generally Accepted Accounting Principles ("GAAP"),
the Company began reporting its financial results on the
liquidation basis of accounting. The liquidation basis of
accounting requires, among other things, that management estimate
asset sales net proceeds on an undiscounted basis, as well as
includes in the Company's assets and liabilities the undiscounted
estimate of future revenues and expenses through the end of the
liquidation.
On July 19, 2021, Luby's reported
an estimate of future liquidating distributions of approximately
$4.13 per common share as of
June 2, 2021 (unaudited), based on
the number of common shares outstanding on that date.
Since June 2, 2021, Luby's has
closed on the sale of 34 real estate assets, including those in the
STORE transaction, closed on the sale of the Fuddruckers franchise
business unit, closed on the sale of the Luby's Cafeterias brand
name and multiple operating locations, received full forgiveness on
its PPP loan, and has settled other of its obligations. Luby's
estimates that the cumulative impact of these transactions, net of
other fourth quarter ordinary course activities and changes in
estimates related to the liquidation basis of accounting, results
in an increase in estimated future liquidating distributions of
approximately $0.76 per common share
(unaudited) over the last reported estimate, for a total estimate
of future liquidating distributions of approximately $4.89 per common share when added to the last
reported estimate. This estimate of future liquidating
distributions includes projections of asset sales net proceeds and
net operating revenues to be received and costs and expenses to be
incurred, including costs to dispose of the Company's assets to
complete the plan of liquidation which is currently projected to be
completed by June 30, 2022. There is
inherent uncertainty with these projections, and accordingly, these
projections could change materially based on a number of factors
both within and outside of Luby's control. There can be no
assurance that these estimated liquidating distributions per common
share will be realized. Such amounts should not be taken as an
indication of the timing or the amount of future distributions or
our actual dissolution. As of today's date, Luby's has seven
additional real estate properties that are under contract but have
refundable deposits, and accordingly we do not recognize any
potential increase in liquidation value from these asset sale
transactions in our estimate of future liquidating value. The
current estimate of net assets in liquidation has been estimated
based on undiscounted cash flow projections and assumes a final
liquidation on June 30, 2022 even
though the actual timing of the sale of the Company's remaining
operating businesses and 28 remaining real estate holdings,
including the properties currently under contract that have not yet
closed, cannot be determined with any specificity at this time. As
such, the final liquidation of the Company is subject to future
events and uncertainties. Liabilities are carried at their
contractual amounts due and are not adjusted until settled. It is
not possible to predict with certainty the timing or aggregate
amount which may ultimately be distributed to our shareholders and
no assurance can be given that the distributions will equal or
exceed the estimate presented in this release.
About Luby's
Luby's, Inc. (NYSE: LUB) previously announced its plan of
liquidation and dissolution, which was approved by its shareholders
on November 17, 2020. Luby's has sold
both its restaurant brands, Luby's Cafeterias and Fuddruckers.
Luby's is actively seeking buyers for its Luby's Culinary Contract
Services business segment, and its packaged foods business segment.
Luby's is in the process of actively seeking buyers for its
remaining real estate assets.
Forward Looking Statements
This press release contains statements that are "forward-looking
statements" within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. All statements contained in this press
release, other than statements of historical fact, are
"forward-looking statements" for purposes of these provisions,
including the statements regarding sales of assets, effects of the
Company's Liquidation and Dissolution Plan (the "Plan"), expected
value or proceeds attributable to the sale of assets, and expected
proceeds to be distributed to stockholders or the timing thereof.
Luby's cautions readers that various factors could cause its actual
financial and operational results to differ materially from those
indicated by forward-looking statements made from time-to-time in
news releases, reports, proxy statements, registration statements,
and other written communications, as well as oral statements made
from time to time by representatives of Luby's. The following
factors, as well as any other cautionary language included in this
press release, provide examples of risks, uncertainties and events
that may cause Luby's actual results to differ materially from the
expectations Luby's describes in such forward-looking statements:
general business and economic conditions; the effects of the
COVID-19 pandemic; the impact of competition; fluctuations in
the costs of commodities, including beef, poultry, seafood, dairy,
cheese and produce; increases in utility costs, including the costs
of natural gas and other energy supplies; changes in the
availability and cost of labor; the seasonality of Luby's business;
changes in governmental regulations, including changes in minimum
wages; the effects of inflation; the availability of credit;
unfavorable publicity relating to operations, including publicity
concerning food quality, illness or other health concerns or labor
relations; the continued service of key management personnel; and
other risks and uncertainties disclosed in Luby's annual reports on
Form 10-K and quarterly reports on Form 10-Q, including information
regarding the risks, uncertainties and other factors relating to
the Plan, the expected net proceeds from the sale of assets, and
expected proceeds to be distributed to stockholders.
For additional information contact:
John Garilli, Interim CEO
(617) 570-4600
LInvestors@lubys.com
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SOURCE Luby's, Inc.