Business Context and Reporting Period
This Form 8-K is filed by Apple REIT Nine, Inc. (a subsidiary of Apple Hospitality REIT, Inc.) for the reporting period of February 4, 2009. The filing addresses the termination of a material definitive agreement regarding a hotel acquisition.
Key Financial Metrics
- Transaction Value: The terminated purchase contract was for a hotel with a purchase price of $11,250,000.
- Debt Assumption: The deal included secured debt to be assumed totaling $6,322,393.
- Asset Size: The property contained 90 guest rooms.
- Cash Flow Impact: An initial deposit of $200,000 was repaid to the Company's subsidiary upon termination.
- Revenue/Profit/Margins: The filing text does not provide a clear value for revenue, profit, or margins as this is a transactional report, not a periodic financial statement.
Material Changes
The primary material change is the cancellation of the acquisition of a hotel in Yuma, Arizona, which was originally announced in a Form 8-K dated January 5, 2009. This action reverses the planned expansion of the Company's portfolio by one property and the associated debt assumption.
Outlook, Risks, and Management Commentary
Management commentary is limited to the factual execution of the termination. The filing notes that the seller had no material relationship with the Company other than the purchase contract. No specific guidance, future outlook, or new risk factors were disclosed in this document beyond the immediate impact of the deal termination.
Investor Verification Points
- Verify the status of the $200,000 deposit repayment and its impact on current liquidity.
- Review the January 5, 2009 Form 8-K for the original terms and rationale of the Yuma, Arizona acquisition.
- Assess whether this termination reflects a broader strategic shift in acquisition criteria due to market conditions in early 2009.
- Confirm the absence of any remaining liabilities or legal contingencies related to the terminated contract.