| ITEM 5.07 | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
On September 10, 2019, CNL Healthcare Properties II, Inc. (the “Company”) held its annual meeting of stockholders (the “Annual Meeting”) at CNL Center at City Commons, Tower I, 13th Floor, 450 South Orange Avenue, Orlando, Florida 32801. At the Annual Meeting, the Company’s stockholders voted in person or by proxy on:
(1) A plan of complete liquidation and dissolution of the Company (the “Plan of Dissolution”, and the proposal, the “Plan of Dissolution Proposal”). The principal purpose of the Plan of Dissolution is to maximize stockholder value by selling the Company’s assets, paying its debts and distributing the net proceeds from liquidation to the Company’s stockholders.
(2) Three proposed amendments to the Company’s charter (together, the “Charter Amendment Proposals”) to:
(a) eliminate (i) conditions and limitations on the Company’s exculpation and indemnification of the Company’s present or former directors and the Company’s external advisor and its affiliates and (ii) limitations on the Company’s ability to reimburse the Company’s present or former directors and the Company’s external advisor or its affiliates for reasonable legal expenses and other costs, each of which had previously been required by state securities administrators in connection with the Company’s initial public offering or that related to such required provisions. Instead, the proposed amendment provides that the Company shall exculpate and indemnify the Company’s present and former directors and officers to the maximum extent permitted by Maryland law and provides the Company the ability to exculpate and indemnify the Company’s external advisor and its affiliates pursuant to the terms of the advisory agreement (the “Indemnification Proposal”),
(b) eliminate the requirement in the Company’s charter to distribute a specific report with audited financial statements, related party and other information to stockholders each year, that had previously been required by state securities administrators in connection with the Company’s initial public offering or that related to such required provisions (the “Reporting Proposal”). Although the charter would no longer require the Company to provide audited financial statements to the Company’s stockholders, any decision by the Company to cease providing audited financial statements to the Company’s stockholders would need to be approved by the board of directors and would require that the Securities and Exchange Committee grant the Company relief from certain reporting requirements under the U.S. Securities Exchange Act of 1934, as amended, and
(c) exclude the distribution of interests in a liquidating trust from the definition of a“roll-up transaction” (the“Roll-Up Definition Proposal”);
(3) The election of the following individuals to the board of directors: Stephen H. Mauldin, Douglas N. Benham, and Dianna F. Morgan.
(4) The ratification of the appointment of Ernst & Young LLP (“E&Y”) as the Company’s independent registered public accounting firm for the year ended December 31, 2019; and
(5) A proposal that would permit the Company (a) to proceed with the voting on and approval of only the proposals that have received sufficient votes to be approved at the Annual Meeting, and (b) subsequently, to adjourn the Annual Meeting, even if a quorum is present, to solicit additional proxies to vote in favor of any proposal that had not received sufficient votes to be approved at the Annual Meeting, if necessary (the “Adjournment Proposal”).
For a detailed description of each of the proposals submitted for stockholder vote at the Annual Meeting, including a summary of the Plan of Dissolution Proposal and the revisions that each of the Charter Amendment Proposals would make to the Company’s previous charter, see the Company’s Definitive Proxy Statement, filed with the Securities and Exchange Commission on July 7, 2019 (the “Proxy Statement”).
The Plan of Dissolution Proposal was approved. The number of votes cast for and votes withheld from, and the number of abstentions and brokernon-votes with respect to, the Plan of Dissolution Proposal were as follows:
| | | | | | | | | | | | | | | | |
| | | Votes For | | | Votes
Against | | | Abstentions | | | Broker
Non-Votes | |
Plan of Dissolution Proposal | | | 2,891,365 | | | | 81,175 | | | | 41,590 | | | | 1,133,789 | |
