Exhibit 99.2
RED LION HOTELS CORPORATION
Unaudited Condensed Consolidated Balance Sheets
As of September 30, 2019
(In thousands, except share data)
As Reported | Less: Atlanta Hotel Asset Previously Sold | Atlanta Pro Forma Adjustments | Less: SLC Hotel Asset Sold | SLC Pro Forma Adjustments | Pro Forma | |||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||
Cash and cash equivalents | 18,267 | 3,653 | a | 93 | f | 21,211 | a | 370 | f | 34,391 | ||||||||||||||
619 | g | (9,822 | ) i | |||||||||||||||||||||
Restricted cash | 2,930 | (619 | ) g | 2,311 | ||||||||||||||||||||
Accounts receivable, net | 19,496 | (338 | ) f | (1,022 | ) f | 18,136 | ||||||||||||||||||
Notes receivable, net | 4,188 | 4,188 | ||||||||||||||||||||||
Other current assets | 4,961 | (174 | ) f | (116 | ) f | 4,671 | ||||||||||||||||||
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Total current assets | 49,842 | 3,653 | (419 | ) | 21,211 | (10,590 | ) | 63,697 | ||||||||||||||||
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Property and equipment, net | 107,554 | (11,500 | ) b | (26,032 | ) b | 70,022 | ||||||||||||||||||
Operating leaseright-of-use assets | 48,553 | 48,553 | ||||||||||||||||||||||
Goodwill | 18,595 | 18,595 | ||||||||||||||||||||||
Intangible assets, net | 58,233 | 58,233 | ||||||||||||||||||||||
Other assets, net | 5,085 | 5,085 | ||||||||||||||||||||||
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Total assets | 287,862 | (7,847 | ) | (419 | ) | (4,821 | ) | (10,590 | ) | 264,185 | ||||||||||||||
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LIABILITIES | ||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||
Accounts payable | 5,176 | (192 | ) f | (322 | ) f | 4,662 | ||||||||||||||||||
Accrued payroll and related benefits | 1,868 | (54 | ) f | (146 | ) f | 1,668 | ||||||||||||||||||
Other accrued liabilities | 5,519 | (173 | ) f | (127 | ) d | (300 | )f | 4,919 | ||||||||||||||||
Long-term debt, due within one year | 24,628 | (8,171 | ) c | 16,457 | ||||||||||||||||||||
Operating lease liabilities, due within one year | 4,801 | 4,801 | ||||||||||||||||||||||
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Total current liabilities | 41,992 | (8,171 | ) | (419 | ) | (127 | ) | (768 | ) | 32,507 | ||||||||||||||
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Long-term debt, due after one year, net of debt issuance costs | 20,496 | (10,939 | ) c | 9,557 | ||||||||||||||||||||
Line of credit, due after one year | 10,000 | 10,000 | ||||||||||||||||||||||
Operating lease liabilities, due after one year | 46,871 | 46,871 | ||||||||||||||||||||||
Deferred income and other long-term liabilities | 1,541 | (38 | ) d | (240 | ) d | 1,263 | ||||||||||||||||||
Deferred income taxes | 1,217 | 1,217 | ||||||||||||||||||||||
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Total liabilities | 122,117 | (8,209 | ) | (419 | ) | (11,306 | ) | (768 | ) | 101,415 | ||||||||||||||
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Commitments and contingencies | ||||||||||||||||||||||||
STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||
RLH Corporation stockholders' equity | ||||||||||||||||||||||||
Preferred stock - 5,000,000 shares authorized; $0.01 par value; no shares issued or outstanding | — | — | ||||||||||||||||||||||
Common stock - 50,000,000 shares authorized; $0.01 par value; 25,075,912 and 24,570,158 shares issued and outstanding | 252 | 252 | ||||||||||||||||||||||
Additionalpaid-in capital, common stock | 182,723 | (71 | ) h | 182,652 | ||||||||||||||||||||
Accumulated deficit | (26,923 | ) | 199 | e | 3,567 | e | (23,157 | ) | ||||||||||||||||
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Total RLH Corporation stockholders’ equity | 156,052 | 199 | (71 | ) | 3,567 | — | 159,747 | |||||||||||||||||
Noncontrolling interest | 9,693 | 163 | e | 71 | h | 2,918 | e | (9,822 | ) i | 3,023 | ||||||||||||||
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Total stockholders’ equity | 165,745 | 362 | — | 6,485 | (9,822 | ) | 162,770 | |||||||||||||||||
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Total liabilities and stockholders’ equity | 287,862 | (7,847 | ) | (419 | ) | (4,821 | ) | (10,590 | ) | 264,185 | ||||||||||||||
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a | - Reflects the cash from the sale of assets less selling costs and the repayment of debt |
b | - Reflects the book value of assets sold |
c | - Reflects the elimination of debt after full repayment |
d | - Reflects the leases and/or equipment financing assumed by the purchaser |
e | - Reflects the gain on sale |
f | - Reflects the settlement of working capital |
g | - Reflects the release of restricted cash related to the assets sold and repayment of debt |
h | - Reflects the elimination of the noncontrolling interest |
i | - Reflects the proforma distribution of cash to the noncontrolling interest. |
RED LION HOTELS CORPORATION
Unaudited Pro Forma Condensed Consolidated Statements of Comprehensive Income (Loss)
For the year ended December 31, 2018
(In thousands, except per share data)
As Reported | Less: Previously Sold Hotels (j) | Prev Sold Pro Forma Adjustments | Less: SLC Hotel Asset Sold | SLC Pro Forma Adjustments | Pro Forma | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Royalty | 22,309 | 317 | l | 244 | l | 22,870 | ||||||||||||||||||
Other franchise | 5,537 | 5,537 | ||||||||||||||||||||||
Company operated hotels | 82,021 | (20,510 | ) | (9,574 | ) | 51,937 | ||||||||||||||||||
Marketing, reservations and reimbursables | 25,948 | 978 | l | 508 | l | 27,434 | ||||||||||||||||||
Other | 34 | 34 | ||||||||||||||||||||||
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Total revenues | 135,849 | (20,510 | ) | 1,295 | (9,574 | ) | 752 | 107,812 | ||||||||||||||||
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Operating expenses: | ||||||||||||||||||||||||
Selling, general, administrative and other expenses | 32,122 | 32,122 | ||||||||||||||||||||||
Company operated hotels | 67,314 | (17,665 | ) | (7,568 | ) | 42,081 | ||||||||||||||||||
Marketing, reservations and reimbursables | 26,877 | 978 | l | 508 | l | 28,363 | ||||||||||||||||||
Depreciation and amortization | 17,003 | (2,448 | ) | (1,918 | ) | 12,637 | ||||||||||||||||||
Asset impairment | 10,582 | 10,582 | ||||||||||||||||||||||
Loss (gain) on asset dispositions, net | (42,021 | ) | 40,713 | 830 | (478 | ) | ||||||||||||||||||
Acquisition and integration costs | 2,219 | 2,219 | ||||||||||||||||||||||
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Total operating expenses | 114,096 | 20,600 | 978 | (8,656 | ) | 508 | 127,526 | |||||||||||||||||
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Operating income (loss) | 21,753 | (41,110 | ) | 317 | (918 | ) | 244 | (19,714 | ) | |||||||||||||||
Other income (expense): | ||||||||||||||||||||||||
Interest expense | (6,209 | ) | 2,479 | 478 | (3,252 | ) | ||||||||||||||||||
Loss on early retirement of debt | (794 | ) | (794 | ) | ||||||||||||||||||||
Other income (expense), net | 265 | (2 | ) | 263 | ||||||||||||||||||||
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Total other income (expense) | (6,738 | ) | 2,477 | — | 478 | — | (3,783 | ) | ||||||||||||||||
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Income (loss) from continuing operations before taxes | 15,015 | (38,633 | ) | 317 | (440 | ) | 244 | (23,497 | ) | |||||||||||||||
Income tax expense (benefit) | (71 | ) | (71 | ) | ||||||||||||||||||||
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Net income (loss) | 15,086 | (38,633 | ) | 317 | (440 | ) | 244 | (23,426 | ) | |||||||||||||||
Net (income) loss attributable to noncontrolling interest | (13,129 | ) | 17,385 | 198 | 4,454 | |||||||||||||||||||
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Net income (loss) and comprehensive income (loss) attributable to RLHC | 1,957 | (21,248 | ) | 317 | (242 | ) | 244 | (18,972 | ) | |||||||||||||||
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Earnings (loss) per share - basic | $ | 0.08 | $ | (0.78 | ) | |||||||||||||||||||
Earnings (loss) per share - diluted | $ | 0.08 | $ | (0.78 | ) | |||||||||||||||||||
Weighted average shares - basic | 24,392 | 24,392 | ||||||||||||||||||||||
Weighted average shares - diluted | 25,477 | 24,392 |
j | - Includes the actual results for the nine company operated hotels sold during the year ended December 31, 2018 and one company operated hotel sold in November 2019. |
l | - Reflects the franchise income and related expenses that would have been received under the existing intercompany franchise agreement. Does not represent the impact of the franchise agreements with the new owners of the assets. |
RED LION HOTELS CORPORATION
Unaudited Pro Forma Condensed Consolidated Statements of Comprehensive Income (Loss)
For the nine months ended September 30, 2019
(In thousands, except per share data)
As Reported | Less: Previously Sold Hotels (j) | Prev Sold Pro Forma Adjustments | Less: SLC Asset Sold | SLC Pro Forma Adjustments | Pro Forma | |||||||||||||||||||
Revenue: | ||||||||||||||||||||||||
Royalty | 17,516 | 104 | l | 192 | l | 17,812 | ||||||||||||||||||
Other franchise | 3,772 | 3,772 | ||||||||||||||||||||||
Company operated hotels | 43,839 | (3,665 | ) | (7,464 | ) | 32,710 | ||||||||||||||||||
Marketing, reservations and reimbursables | 22,632 | 256 | l | 276 | l | 23,164 | ||||||||||||||||||
Other | 13 | 13 | ||||||||||||||||||||||
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Total revenues | 87,772 | (3,665 | ) | 360 | (7,464 | ) | 468 | 77,471 | ||||||||||||||||
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Operating expenses: | ||||||||||||||||||||||||
Selling, general, administrative and other expenses | 21,921 | 21,921 | ||||||||||||||||||||||
Company operated hotels | 36,750 | (3,190 | ) | (5,871 | ) | 27,689 | ||||||||||||||||||
Marketing, reservations and reimbursables | 22,088 | 256 | l | 276 | l | 22,620 | ||||||||||||||||||
Depreciation and amortization | 11,192 | (510 | ) | (1,377 | ) | 9,305 | ||||||||||||||||||
Asset impairment | 5,382 | 5,382 | ||||||||||||||||||||||
Loss (gain) on asset dispositions, net | 45 | 45 | ||||||||||||||||||||||
Transaction costs | 436 | 436 | ||||||||||||||||||||||
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Total operating expenses | 97,814 | (3,700 | ) | 256 | (7,248 | ) | 276 | 87,398 | ||||||||||||||||
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Operating income (loss) | (10,042 | ) | 35 | 104 | (216 | ) | 192 | (9,927 | ) | |||||||||||||||
Other income (expense): | ||||||||||||||||||||||||
Interest expense | (3,690 | ) | 803 | 311 | (2,576 | ) | ||||||||||||||||||
Loss on early retirement of debt | (164 | ) | (164 | ) | ||||||||||||||||||||
Other income (expense), net | 121 | (2 | ) | 119 | ||||||||||||||||||||
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Total other income (expense) | (3,733 | ) | 801 | — | 311 | — | (2,621 | ) | ||||||||||||||||
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Income (loss) from continuing operations before taxes | (13,775 | ) | 836 | 104 | 95 | 192 | (12,548 | ) | ||||||||||||||||
Income tax expense (benefit) | 676 | 676 | ||||||||||||||||||||||
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Net income (loss) | (14,451 | ) | 836 | 104 | 95 | 192 | (13,224 | ) | ||||||||||||||||
Net (income) loss attributable to noncontrolling interest | 4,040 | (376 | ) | (43 | ) | 3,621 | ||||||||||||||||||
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Net income (loss) and comprehensive income (loss) attributable to RLHC | (10,411 | ) | 460 | 104 | 52 | 192 | (9,603 | ) | ||||||||||||||||
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Earnings (loss) per share - basic | $ | (0.42 | ) | $ | (0.39 | ) | ||||||||||||||||||
Earnings (loss) per share - diluted | $ | (0.42 | ) | $ | (0.39 | ) | ||||||||||||||||||
Weighted average shares - basic | 24,859 | 24,859 | ||||||||||||||||||||||
Weighted average shares - diluted | 24,859 | 24,859 |
j | - Includes the actual results for the one company operated hotel sold in November 2019. |
l | - Reflects the franchise income and related expenses that would have been received under the existing intercompany franchise agreement. Does not represent the impact of the franchise agreements with the new owners of the assets. |