Item 4 of the below filing provides the following update:
On March 1, 2016, an affiliate of the Reporting Persons issued a letter to the shareholders of the Issuer (the “Letter to Shareholders”) outlining the Reporting Persons’ analysis regarding the unrecognized value of the Assets and how the capital infusion provided by the sale of the Assets could allow the Issuer to pursue several opportunities to enhance value for all shareholders. The Letter to Shareholders details the Issuer’s recent operational and financial underperformance and concludes by encouraging shareholders to contact the Issuer’s management to better understand their strategic, long-term vision for the Issuer’s business and to compare such vision to the Reporting Persons’ proposals.The forgoing description of the Letter to Shareholders does not purport to be complete and is qualified in its entirety by reference to the full text of the Letter to Shareholders, which is filed as Exhibit 99.1 hereto and is incorporated herein by reference.
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Ownership Summary Table
| Name | Sole Voting Power | Shared Voting Power | Sole Dispositive Power | Shared Dispositive Power | Aggregate Amount Owned Power | Percent of Class |
|---|---|---|---|---|---|---|
| William F. Thomas | 320,511 | 2,799,242 | 320,511 | 2,799,242 | 3,119,753 | 6.4% |
| Robert D. Thomas | 0 | 3,022,076 | 0 | 3,022,076 | 3,022,076 | 6.2% |
| Gemini Properties | 0 | 1,915,164 | 0 | 1,915,164 | 1,915,164 | 3.9% |
Page 1 of 9 SEC Filing
United States
Securities and Exchange Commission, Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)*
FIVE STAR QUALITY CARE, INC.
(Name of Issuer)
Common Stock
(Title of Class of Securities)
33832D106
(CUSIP Number)
| Eller & Detrich, P.C. | Akin Gump Strauss Hauer & Feld LLP | |
| Attn: Philip J. Eller, Esq. | Attn: Jeffrey L. Kochian, Esq. | |
| 2727 East 21st Street, Suite 200 | One Bryant Park | |
| Tulsa, Oklahoma 74114 | New York, New York 10036 |
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
March 1, 2016
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of sections 240.13d-1(e) or 240.13d-1(f) or 240.13d-1(g), check the following box. [X]
NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
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Page 2 of 9 SEC Filing
CUSIP No. 33832D106
(1) Names of reporting persons
William F. Thomas
(2) Check the appropriate box if a member of a group (see instructions)
(a)
(b)
(3) SEC only
(4) Source of funds (see instructions)
PF, OO
(5) Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)
(6) Citizenship or place of origination
United States
Number of shares beneficially owned by each reporting person with:
(7) Sole voting power
320,511
(8) Shared voting power
2,799,242
(9) Sole dispositive power
320,511
(10) Shared dispositive power
2,799,242
(11) Aggregate amount beneficially owned by each reporting person
3,119,753
(12) Check if the aggregate amount in Row (11) excludes certain shares (see instructions)
(13) Percent of class represented by amount in Row (11)
6.4%
(14) Type of reporting person (see instructions)
IN
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Page 3 of 9 SEC Filing
CUSIP No. 33832D106
(1) Names of reporting persons
Robert D. Thomas
(2) Check the appropriate box if a member of a group (see instructions)
(a)
(b)
(3) SEC only
(4) Source of funds (see instructions)
PF, OO
(5) Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)
(6) Citizenship or place of origination
United States
Number of shares beneficially owned by each reporting person with:
(7) Sole voting power
0
(8) Shared voting power
3,022,076
(9) Sole dispositive power
0
(10) Shared dispositive power
3,022,076
(11) Aggregate amount beneficially owned by each reporting person
3,022,076
(12) Check if the aggregate amount in Row (11) excludes certain shares (see instructions)
(13) Percent of class represented by amount in Row (11)
6.2%
(14) Type of reporting person (see instructions)
IN
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Page 4 of 9 SEC Filing
CUSIP No. 33832D106
(1) Names of reporting persons
Gemini Properties
(2) Check the appropriate box if a member of a group (see instructions)
(a)
(b)
(3) SEC only
(4) Source of funds (see instructions)
WC
(5) Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)
(6) Citizenship or place of origination
Oklahoma, United States
Number of shares beneficially owned by each reporting person with:
(7) Sole voting power
0
(8) Shared voting power
1,915,164
(9) Sole dispositive power
0
(10) Shared dispositive power
1,915,164
(11) Aggregate amount beneficially owned by each reporting person
1,915,164
(12) Check if the aggregate amount in Row (11) excludes certain shares (see instructions)
(13) Percent of class represented by amount in Row (11)
3.9%
(14) Type of reporting person (see instructions)
PN
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Page 5 of 9 SEC Filing
CUSIP No. 33832D106
Amendment No. 2 to Schedule 13D
The following constitutes Amendment No. 2 to the Schedule 13D filed with the Securities and Exchange Commission by William F. Thomas, Robert D. Thomas and Gemini Properties (collectively, the “Reporting Persons”) on December 2, 2015, as amended by Amendment No. 1 filed on December 15, 2015. This Amendment No. 2 amends and supplements the Schedule 13D as specifically set forth herein.
All capitalized terms contained herein but not otherwise defined shall have the meanings ascribed to such terms in the Schedule 13D, as amended. Information given in response to each item shall be deemed incorporated by reference in all other items, as applicable.
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 of this Schedule 13D is hereby amended and restated in its entirety as follows:
The information in Item 5(a) is incorporated by reference into this Item 3.
The 320,511 shares of Common Stock of the Issuer held by William F. Thomas and the 2,150 shares of Common Stock of the Issuer held in an individual retirement fund of a family member of William F. Thomas were purchased using the personal funds of William F. Thomas and his family members at a total cost of $1,265,914. The 20,000 shares of Common Stock of the Issuer held by a donor advised charitable fund for which William F. Thomas may be deemed to be a beneficial owner were purchased at a total cost of $99,230 by the donor advised charitable fund with personal funds of William F. Thomas and his family members which were donated to such donor advised charitable fund.
The 39,800 shares of Common Stock of the Issuer held in certain investment funds of Robert D. Thomas’ family members and the 18,500 shares of Common Stock of the Issuer held by a family trust account for which Robert D. Thomas may be deemed to be a beneficial owner were purchased using the personal funds of Robert D. Thomas and his family members at a total cost of $163,992. The 186,684 shares of Common Stock of the Issuer held by certain donor advised charitable funds for which Robert D. Thomas may be deemed to be a beneficial owner were purchased by the donor advised charitable fund with personal funds of Robert D. Thomas and his family members which were donated to such donor advised charitable funds or purchased with the personal funds of Robert D. Thomas and his family members and donated to such donor advised charitable funds at a total cost of $937,514.
The 1,915,164 shares of Common Stock of the Issuer which are held by Gemini Properties were purchased with the working capital of Gemini Properties at a cost of $5,672,742.
The 861,928 shares of Common Stock of the Issuer which are held by a donor advised charitable fund and may be deemed to be beneficially owned by William F. Thomas and/or Robert D. Thomas were purchased at a total cost of $3,228,470 with personal funds of William F. Thomas, Robert D. Thomas, and their respective immediate family members which were donated to such donor advised charitable fund.
Item 4. Purpose of Transaction.
Item 4 of Schedule 13D is supplemented and superseded, as the case may be, as follows:
The disclosure regarding the transactions reported in Item 5(c) below is incorporated herein by reference.
As previously disclosed, on December 15, 2015, GPA, Inc. (“GPA”), an affiliate of the Reporting Persons, sent to Five Star Quality Care, Inc. (the “Issuer”) a Letter of Intent signed by GPA pursuant to which GPA proposed to acquire 33 senior living facilities (the “Assets”) owned by the Issuer and its subsidiaries (collectively, the “Sellers”), which constitute all real properties owned by the Sellers, for a proposed purchase price of $325,000,000, payable in cash at the closing of the transaction. On December 21, 2015, the Issuer sent a letter to William F. Thomas stating that the Issuer’s Board of Directors (the “Board”) had unanimously determined that the Assets were not for sale.
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Page 6 of 9 SEC Filing
The Reporting Persons continue to believe that the sale of the Assets to GPA could help the Issuer realize the value of the Assets while simultaneously providing an optimal source of capital to unlock the Assets’ intrinsic, long-term value, allowing the Issuer to establish itself as the “best-in-class” standalone, diversified operator in the seniors housing industry.
On March 1, 2016, an affiliate of the Reporting Persons issued a letter to the shareholders of the Issuer (the “Letter to Shareholders”) outlining the Reporting Persons’ analysis regarding the unrecognized value of the Assets and how the capital infusion provided by the sale of the Assets could allow the Issuer to pursue several opportunities to enhance value for all shareholders. The Letter to Shareholders details the Issuer’s recent operational and financial underperformance and concludes by encouraging shareholders to contact the Issuer’s management to better understand their strategic, long-term vision for the Issuer’s business and to compare such vision to the Reporting Persons’ proposals.
The forgoing description of the Letter to Shareholders does not purport to be complete and is qualified in its entirety by reference to the full text of the Letter to Shareholders, which is filed as Exhibit 99.1 hereto and is incorporated herein by reference.
The Reporting Persons continuously assess the Issuer’s business, financial condition, results of operations and prospects, general economic conditions, other developments and additional investment opportunities. Depending on such assessments, the Reporting Persons and/or their affiliates may acquire additional securities of the Issuer or may determine to sell or otherwise dispose of all or some of the Issuer’s securities in the open market, in privately negotiated transactions, in transactions directly with the Issuer or otherwise. Such actions will depend upon a variety of factors, including, without limitation, current and anticipated future trading prices, the financial condition, results of operations and prospects of the Issuer, alternative investment opportunities, general economic, financial market and industry conditions and other factors that the Reporting Persons and/or their affiliates may deem material to their investment decision.
The Reporting Persons beneficially own, or may be deemed to beneficially own, the Common Stock of the Issuer for investment purposes, and other than as described herein or elsewhere in the Schedule 13D, as amended, do not have any present intent to influence or control the Issuer. Depending on various factors including, without limitation, the Issuer’s financial position and investment strategy, the price levels of the Common Stock, conditions in the securities markets and general economic and industry conditions, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, engaging in communications with management of the Issuer and the Board, engaging in discussions with other shareholders of the Issuer and others about the Issuer and the Reporting Persons’ investment, making proposals to the Issuer concerning changes to the capitalization, ownership structure, Board structure (including Board composition) or operations of the Issuer or changing their intention with respect to any and all matters referred to in subparagraphs (a) through (j) of Item 4 of Schedule 13D. Except as set forth herein or elsewhere in the Schedule 13D, as amended, the Reporting Persons do not have present plans or proposals at this time that relate to or would result in any of the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
Item 5 of this Schedule 13D is hereby amended and restated in its entirety as follows:
(a)
William F. Thomas directly holds and has beneficial ownership of 320,511 shares of Common Stock of the Issuer. By virtue of his role as an advisor to certain donor advised charitable funds, Mr. W.F. Thomas may be deemed to beneficially own 20,000 shares of Common Stock of the Issuer. Mr. W.F. Thomas disclaims such beneficial ownership. By virtue of his role as an advisor to an individual retirement fund of a family member, Mr. W.F. Thomas may be deemed to beneficially own an additional 2,150 shares of Common Stock of the Issuer. Mr. W.F. Thomas disclaims such beneficial ownership.
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Page 7 of 9 SEC Filing
Robert D. Thomas does not directly hold any shares of Common Stock of the Issuer. By virtue of his position as an advisor to certain family investment funds, Mr. R.D. Thomas may be deemed to have beneficial ownership of 39,800 shares of Common Stock of the Issuer. By virtue of his position as trustee of a family trust account, Mr. R.D. Thomas may be deemed to have beneficial ownership of 18,500 shares of Common Stock of the Issuer. Mr. R.D. Thomas disclaims such beneficial ownership of shares of Common Stock of the Issuer owned by such family investment funds and family trust account. By virtue of his role as an advisor to certain donor advised charitable funds, Mr. R.D. Thomas may be deemed to beneficially own 186,684 shares of Common Stock of the Issuer. Mr. R.D. Thomas disclaims such beneficial ownership.
Gemini Properties, an Oklahoma general partnership, holds and beneficially owns 1,915,164 shares of Common Stock of the Issuer. Mr. W.F. Thomas and Mr. R.D. Thomas, as general partners of Gemini Properties, may each be deemed to beneficially own such shares of Common Stock of the Issuer.
By virtue of their respective roles as co-advisors to a donor advised charitable investment fund, Mr. W.F. Thomas and Mr. R.D. Thomas may be deemed to beneficially own 861,928 shares of Common Stock of the Issuer. Mr. W.F. Thomas and Mr. R.D. Thomas each disclaims such beneficial ownership.
NOTE: All statements made in this Schedule 13D with respect to beneficial ownership, including, without limitation, all disclaimers of beneficial ownership, are made with respect to beneficial ownership as that term is defined in Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and such statements are made solely for the purpose of reporting under Section 13(d) of the Exchange Act. All disclaimers of beneficial ownership are made pursuant to Rule 13d-4 promulgated under the Exchange Act and are made solely for the purpose of expressly declaring that the filing of this Schedule 13D and the statements contained herein shall not be construed as an admission that either Mr. W.F. Thomas or Mr. R.D. Thomas is, for the purposes of Section 13(d) or 13(g) of Exchange Act, a beneficial owner of such shares of Common Stock of the Issuer.
Neither Mr. W.F. Thomas nor Mr. R.D. Thomas directly holds more than 1% of the outstanding Common Stock of the Issuer. Gemini Properties directly holds 3.9% of the outstanding Common Stock of the Issuer and may be deemed to have beneficial ownership of such shares of Common Stock. By reason of the relationships described in this Item 5(a), and without regard to the relevant disclaimers, it may be possible that Mr. W.F. Thomas may be deemed to beneficially own approximately 6.4% of the Common Stock of the Issuer and Mr. R.D. Thomas may be deemed to beneficially own approximately 6.2% of the Common Stock of the Issuer.
The percentages of beneficial ownership reported in this Schedule 13D were calculated based on 49,035,915 shares of Common Stock of the Issuer outstanding as of November 5, 2015, as reported in the Issuer’s Form 10-Q filed with Securities and Exchange Commission on November 6, 2015.
(b) Number of shares as to which the person has:
(i) Sole power to vote or to direct the vote:
Willliam F. Thomas, 320,511
Robert D. Thomas, 0
Gemini Properties, 0
(ii) Shared power to vote or to direct the vote:
William F. Thomas, 2,799,242
Robert D. Thomas, 3,022,076
Gemini Properties, 1,915,164
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Page 8 of 9 SEC Filing
(iii) Sole power to dispose or to direct the disposition of:
William F. Thomas, 320,511
Robert D. Thomas, 0
Gemini Properties, 0
(iv) Shared power to dispose or to direct the disposition of:
William F. Thomas, 2,799,242
Robert D. Thomas, 3,022,076
Gemini Properties, 1,915,164
(c) Within the last 60 days, a donor advised fund maintained by a community foundation in Tulsa, Oklahoma effected the following transaction in a secondary market in the fund’s trading account based on the advice of Mr. R.D. Thomas and Mr. W. F. Thomas:
| Date | Purchase/Sale | Quantity | Cost | Cost/Share |
| 02-11-2016 | Purchase | 10,000 | $21,793 | $2.18 |
Within the last 60 days, Gemini Properties effected the following transaction in a secondary market in Gemini Properties’ trading account:
| Date | Purchase/Sale | Quantity | Cost | Cost/Share |
| 02-12-2016 | Purchase | 100,000 | $220,347 | $2.20 |
(d) Not applicable
(e) Not applicable
Item 7. Material to be Filed as Exhibits.
Exhibit 99.1 Letter to Shareholders of Five Star Quality Care, Inc.
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Page 9 of 9 SEC Filing
CUSIP No. 33832D106
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
Date:
March 1, 2016
WILLIAM F. THOMAS
/s/ William F. Thomas
(Signature)
ROBERT D. THOMAS
/s/ Robert D. Thomas
(Signature)
GEMINI PROPERTIES
/s/ William F. Thomas
(Signature)
William F. Thomas, Partner
(Name/Title)
/s/ Robert D. Thomas
(Signature)
Robert D. Thomas, Partner
(Name/Title)
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