SC 13D/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 2)¹

Capital Senior Living Corporation

(Name of Issuer)

Common Stock, par value $0.01

(Title of Class of Securities)

140475203

(CUSIP Number)

Ortelius Advisors, L.P.

c/o Peter DeSorcy

450 Park Avenue, Suite 2700

New York, NY 10022

(917) 595-5010

Steve Wolosky, Esq.

Kenneth Mantel, Esq.

Olshan Frome Wolosky LLP

1325 Avenue of the Americas

New York, New York 10019

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

August 5, 2021

(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 §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note:  Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See § 240.13d-7 for other parties to whom copies are to be sent.

1              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 disclosures provided in a prior cover page.

The information required on 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).

CUSIP No. 140475203

	1	NAME OF REPORTING PERSON
			Pangaea Ventures, L.P.
	2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP				(a) ☐
						(b) ☐
	3	SEC USE ONLY
	4	SOURCE OF FUNDS
			OO
	5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)				☐
	6	CITIZENSHIP OR PLACE OF ORGANIZATION
			Delaware
NUMBER OF			7	SOLE VOTING POWER
SHARES
BENEFICIALLY					- 0 -
OWNED BY			8	SHARED VOTING POWER
EACH
REPORTING					255,732
PERSON WITH			9	SOLE DISPOSITIVE POWER
					- 0 -
			10	SHARED DISPOSITIVE POWER
					255,732
	11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
			255,732
	12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES				☐
	13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
			11.7%
	14	TYPE OF REPORTING PERSON
			PN

2

CUSIP No. 140475203

	1	NAME OF REPORTING PERSON
			Ortelius Advisors, L.P.
	2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP				(a) ☐
						(b) ☐
	3	SEC USE ONLY
	4	SOURCE OF FUNDS
			AF
	5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)				☐
	6	CITIZENSHIP OR PLACE OF ORGANIZATION
			Delaware
NUMBER OF			7	SOLE VOTING POWER
SHARES
BENEFICIALLY					- 0 -
OWNED BY			8	SHARED VOTING POWER
EACH
REPORTING					255,732
PERSON WITH			9	SOLE DISPOSITIVE POWER
					- 0 -
			10	SHARED DISPOSITIVE POWER
					255,732
	11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
			255,732
	12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES				☐
	13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
			11.7%
	14	TYPE OF REPORTING PERSON
			IA

3

CUSIP No. 140475203

	1	NAME OF REPORTING PERSON
			Peter DeSorcy
	2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP				(a) ☐
						(b) ☐
	3	SEC USE ONLY
	4	SOURCE OF FUNDS
			AF
	5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)				☐
	6	CITIZENSHIP OR PLACE OF ORGANIZATION
			New York
NUMBER OF			7	SOLE VOTING POWER
SHARES
BENEFICIALLY					- 0 -
OWNED BY			8	SHARED VOTING POWER
EACH
REPORTING					255,732
PERSON WITH			9	SOLE DISPOSITIVE POWER
					- 0 -
			10	SHARED DISPOSITIVE POWER
					255,732
	11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
			255,732
	12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES				☐
	13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
			11.7%
	14	TYPE OF REPORTING PERSON
			IN, HC

4

CUSIP No. 140475203

This Amendment No. 2 to the Schedule 13D (this “Amendment No. 2”) relates to the common stock, par value $0.01 per share (the “Common Stock”), of Capital Senior Living Corporation, a Delaware corporation (the “Issuer”), and amends the Schedule 13D filed by the Reporting Persons (as defined below) on March 25, 2021 (the “Original Schedule 13D”), as amended by Amendment No. 1 filed on June 9, 2021 (“Amendment No. 1”, and together with the Original Schedule 13D, the “Schedule 13D”). Any capitalized terms used and not defined in this Amendment No. 2 have the meanings set forth in the Schedule 13D.

This Amendment No. 2 is being filed on behalf of: (i) Pangaea Ventures, L.P., a Delaware limited partnership (“Pangaea”); (ii) Ortelius Advisors, L.P., a Delaware limited partnership (“OA”); and (iii) Peter DeSorcy (“Mr. DeSorcy”, and, together with Pangaea and OA, the “Reporting Persons”).

Since the date of Amendment No. 1, Pangaea purchased additional shares of Common Stock, as described in further detail in Item 5 below, and delivered a letter to the Issuer’s Board of Directors (the “Board”) and issued a related press release. This Amendment No. 2 is being filed to amend Item 3, Item 4 and Item 5 of the Schedule 13D to reflect those developments. Except as amended hereby, all statements and disclosures in the Schedule 13D remain accurate as of the date of this Amendment No. 2.

Item 3. Source and Amount of Funds or Other Consideration

Item 3 of the Schedule 13D is hereby amended and restated in its entirety as follows:

Pangaea has expended an aggregate of approximately $7,562,388 of its investment capital to acquire the 255,732 shares of Common Stock beneficially owned by Pangaea (the “Shares”).

Item 4. Purpose of Transaction

Item 4 of the Schedule 13D is hereby amended and restated in its entirety as follows:

The Reporting Persons acquired the Shares over which they exercise beneficial ownership in the belief that the Shares are undervalued and an attractive investment opportunity.

The Reporting Persons have engaged in discussions with management and the Board regarding the Issuer’s performance, capital structure, financial condition and, generally, opportunities to maximize value for the Issuer’s stockholders.

On August 9, 2021, OA delivered a letter to the Board expressing its strong opposition to the Issuer’s recently announced transactions (the “Transactions”) with Conversant Capital LLC (together with its affiliates, “Conversant”), including but not limited to an interim debt financing with a headline interest rate of 15% and a payment premium to give Conversant a capital return of 1.05x to 1.20x on top of accrued interest. In the letter, OA noted the plunge in the Issuer’s stock price since the Transactions were announced and expressed its concerns regarding the troubling terms of the Transactions, and their implications for the Issuer’s stockholders. OA also noted that the Transactions require formal stockholder approval at the Issuer’s upcoming special meeting of stockholders, and expressed its view that the Issuer and Conversant have structured the interim financing to be as coercive to stockholders as possible to obtain approval.

OA stated that it believes the Board has breached its fiduciary duties to stockholders by entering into the agreements with Conversant associated with the Transactions, and that it unequivocally opposes the Transactions and intends to vote its Shares against their approval.

OA offered to meet with and assist the Board in exploring alternative strategic and/or financing options.

5

CUSIP No. 140475203

OA issued a press release including the full text of the letter, which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

No Reporting Person has any present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) - (j) of Item 4 of Schedule 13D except as set forth herein or such as would occur upon or in connection with completion of, or following, any of the actions discussed herein. The Reporting Persons intend to review their investment in the Issuer on a continuing basis, and may, from time to time and at any time in the future depending on various factors, including, without limitation, the outcome of any discussions referenced above, the Issuer’s financial performance and strategic direction, actions taken by the Board, price levels and availability of the shares of Common Stock, other investment opportunities available to the Reporting Persons, conditions in the securities market and general economic and industry conditions, take such actions with respect to their investment in the Issuer as they deem appropriate, including, without limitation, acquiring additional shares of Common Stock and/or other equity, other securities, or derivative or other instruments that are based upon or relate to the value of the shares of Common Stock (collectively, “Securities”) in the open market or otherwise, disposing of any or all of their Securities in the open market or otherwise, engaging in any hedging or similar transactions with respect to the Securities, including swaps and other derivative instruments, enter into share lending or borrowing arrangements, engaging in additional communications with management and the Board, engaging in discussions with stockholders of the Issuer or other third parties about the Issuer and the Reporting Persons’ investment, including making recommendations or proposals to the Issuer concerning changes to the capitalization, capital allocation, ownership structure, management and Board structure (including Board composition), potential transactions involving the Issuer or certain of its businesses, including transactions in which the Reporting Persons may seek to participate and potentially engage in, or suggestions for improving the Issuer’s financial and/or operational performance, or changing their intention with respect to any and all matters referred to in this Item 4.

Item 5. Interest in Securities of the Issuer

Item 5 of the Schedule 13D is hereby amended and restated in its entirety as follows:

(a) (b) As of the filing date of this Amendment No. 2, the Reporting Persons, in total, beneficially own 255,732 Shares. The Shares represent approximately 11.7% of the outstanding shares of Common Stock. Percentages of the shares of Common Stock outstanding reported in this Amendment No. 2 are calculated based upon the 2,182,375 shares of Common Stock outstanding as of May 10, 2021, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission on May 14, 2021. OA has voting and dispositive power over the Shares held by Pangaea, and through ownership and control Mr. DeSorcy has voting and dispositive power over portfolios managed by OA.

(c) Set forth on Schedule A hereto are all transactions in the securities of the Issuer effected since the filing of Amendment No. 1 to the Schedule 13D by any Reporting Person, inclusive of any transactions effected through August 9, 2021.

(d) Other than Pangaea that beneficially holds the Shares, and except as set forth in this Item 5, no other person is known to have the right to receive, or the power to direct the receipt of, dividends from or proceeds from the sale, of the Shares.

(e) Not applicable.

6

CUSIP No. 140475203

Item 7. Material to be filed as Exhibits

Item 7 of the Schedule 13D is hereby amended to add the following exhibit: 

Exhibit Number	Description of Exhibits
99.1	Press Release, dated August 9, 2021

7

CUSIP No. 140475203

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: August 9, 2021	PANGAEA VENTURES, L.P.
	By:	Ortelius Advisors GP I, LLC, its general partner
	By:	/s/ Peter DeSorcy
		Name:	Peter DeSorcy
		Title:	Managing Member

Date: August 9, 2021	ORTELIUS ADVISORS, L.P.
	By:	Ortelius Management, LLC, its general partner
	By:	/s/ Peter DeSorcy
		Name:	Peter DeSorcy
		Title:	Managing Member

Date: August 9, 2021	/s/ Peter DeSorcy
	Peter DeSorcy

8

CUSIP No. 140475203

SCHEDULE A

This Schedule A sets forth information with respect to each purchase and sale of the Shares which were effectuated by the Reporting Persons since the filing of Amendment No. 1 to the Schedule 13D, inclusive of any transactions effected through August 9, 2021. Unless otherwise indicated, all transactions were effectuated in the open market through a broker. 

Date of Transaction	Number of Shares Purchased (Sold)	Average Price per Share ($)
June 10, 2021	2,957	$41.37
June 11, 2021	100	$41.75
June 14, 2021	100	$44.70
June 23, 2021	2,431	$44.37
July 21, 2021	2,983	$40.81
August 5, 2021	28,091	$23.45
August 6, 2021	9,120	$25.04
August 9, 2021	60,000	$25.98

EX-99.1

Exhibit 99.1

Ortelius Sends Letter to the Board of Directors of Capital Senior Living Corporation Regarding its Strong Opposition to Recently Announced Transactions with Conversant Capital

NEW YORK--(BUSINESS WIRE)--Ortelius Advisors, L.P. (together with its affiliates, "Ortelius" or “we”) today issued the below letter to the Board of Directors of Capital Senior Living Corporation (NYSE: CSU).

***

August 9, 2021

The Board of Directors

Attn: Chairman Michael W. Reid

Capital Senior Living Corporation

14160 Dallas Parkway, Suite 300

Dallas, Texas 75254

Chairman Reid and Members of the Board of Directors:

Ortelius Advisors, L.P. (together with its affiliates, “Ortelius” or “we”) is one of the largest stockholders of Capital Senior Living Corporation (“CSU” or the “Company”), with holdings equal to approximately 9% of the Company’s outstanding common stock (the “Common Stock”). We are writing to make you aware that Ortelius strongly opposes CSU’s recently announced transactions (the “Transactions”) with Conversant Capital LLC (together with its affiliates, “Conversant”).

Based on the market’s overwhelmingly negative reaction in recent weeks, we believe other stockholders share our view: the Company’s stock price has plunged an incredible 48% since the Transactions were announced on July 22^nd.¹ The market evidently recognizes that these highly-questionable Transactions include egregious terms, which effectively hand control of CSU to Conversant while punitively diluting existing stockholders and hindering the business with excessive costs.

The Transactions demonstrably fail to maximize the value of the Company, which is now trading at a significant discount to its underlying assets. We find it alarming that the Board, which owes fiduciary obligations to all stockholders, would effectively seek to sell control of the Company to Conversant at what we believe is a material discount without at least conducting a more thorough review of strategic alternatives. Surely the Board is aware that we are now in the late innings of the pandemic and the industry is in recovery. The Company itself, in its earnings call on May 13^th, indicated that occupancy and financial metrics were improving, long-term demographic tailwinds remained intact, and that the hard work of its “three-year transformational strategy” to stabilize the business was “complete.”

¹ Based on closing prices on July 21, 2021 and August 4, 2021.

Fundamentally, we believe there are other stockholders like Ortelius who not only oppose this transaction, but also stand ready, willing and able to assist the Company with its near-term capital needs and other strategic initiatives in light of the Company’s tremendous long-term potential.

To make our concerns abundantly clear, we have highlighted some of the more troubling terms associated with the proposed Transactions and this de facto handover of the business to Conversant. We take exception to the following:

· A highly-dilutive $82.5 million private placement of newly created Series A Convertible Preferred Stock (the “Preferred Stock”) that will accrue preferred dividends at a rate of 11% to 15%, and will be convertible into Common Stock at an initial conversion price of $40.00 per share, which is a 16% discount to the 30-trading day VWAP ending July 21, the day before the announcement of the Transactions.

· The exceedingly costly interim debt financing from Conversant of approximately $17.3 million, with a headline interest rate of 15% and approximately $2.3 million earmarked to pay Conversant’s costs and expenses, and with a payment premium to give Conversant a capital return of 1.05x to 1.20x on top of accrued interest.

· The commitment from Conversant to backstop $42.5 million of an approximately $70 million Common Stock rights offering to existing stockholders at $32.00 per share, to be funded through the issuance of additional Preferred Stock to Conversant and potentially by Conversant deeming the interim financing repaid.

· $25 million accordion from Conversant for certain post-closing expenditures, to be funded through the issuance of additional Preferred Stock to Conversant.

· Upon closing of the Transactions and for so long as Conversant beneficially owns at least 15% of the Common Stock on an as-converted basis, Conversant will have the right to designate a pro rata number of directors (rounded to the nearest whole number) for nomination to the Board, and for so long as Conversant beneficially owns at least 20% of the Common Stock on an as-converted basis, Conversant also will be entitled to designate the Board’s chairperson.

· Covenants and consent requirements prior to and following closing of the Transactions that prohibit the Company from taking various actions without Conversant’s consent, giving Conversant effective control of the Company in certain business-critical respects.

It appears that in light of the Transactions requiring formal stockholder approval at the Company’s upcoming special meeting of stockholders, the Company and Conversant have structured the interim financing to be as coercive to stockholders as possible to obtain approval. As one example, if the Transactions are not approved and the interim financing is not repaid as part of their closing, the payment premium on the interim financing rises from 1.05x to 1.20x. We can only view this provision, and the interim financing itself, as designed to make it punitive for stockholders to reject the Transactions. It seems to us that the Board is aware these deals cannot stand on their own merits.

At bottom, Ortelius believes the Board has breached its fiduciary duties to stockholders by entering into these agreements with Conversant. We do not believe that CSU had an immediate need for the interim financing, and even if it did, based upon conversations with investment bankers and those who have knowledge of the Company’s financing needs, we contend that the Board had numerous alternatives available to it to address any capital requirements at year end. If for some reason those alternatives were not available, we believe the Company should have fully explored all strategic alternatives available to it. Ortelius believes that a thorough and comprehensive strategic process – looking beyond the short-term business impact of the pandemic – would have led to CSU’s being valued at a significant premium to its recent one-year high trading price of $58.94.

To be clear, Ortelius unequivocally opposes the Transactions and intends to vote its shares against their approval, and we believe that a majority of stockholders will not support the Transactions. There remain ample opportunities for the Board to fulfill its fiduciary responsibilities to stockholders, including by credibly assessing alternative strategic and/or financing options which benefit, not impair, all equity holders. We are ready and available to meet with and assist the Board in exploring these alternatives.

Regards,

Peter DeSorcy

Managing Member

Ortelius Advisors, L.P.

***

About Ortelius Advisors, L.P.

Ortelius is a research-intensive, fundamental-based, activist-oriented alternative investment management firm focused on event-driven opportunities. Founded in 2015 by Peter DeSorcy and H.R.H. Prince Pavlos, the asset manager is based in New York City.

Certain Information Concerning the Participants

Ortelius Advisors, L.P. (“Ortelius Advisors”), together with the other participants named herein, intends to file a preliminary proxy statement and accompanying proxy card with the Securities and Exchange Commission (“SEC”) to be used to solicit votes against the proposed issuance by Capital Senior Living Corporation (the “Company”) of shares of newly designated Series A Convertible Preferred Stock of the Company to affiliates of Conversant Capital LLC as contemplated by an Investment Agreement entered into by and among such parties, and other Company proposals, at the upcoming special meeting of stockholders of the Company.

ORTELIUS ADVISORS STRONGLY ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS’ PROXY SOLICITOR.

The participants in the proxy solicitation are anticipated to be Ortelius Advisors, Pangaea Ventures, L.P. (“Pangaea”) and Peter DeSorcy.

As of the date hereof, Pangaea directly owns 195,732 shares of common stock, par value $0.01 per share (the “Common Stock”), of the Company. Ortelius Advisors, as the investment manager of Pangaea, may be deemed to beneficially own the 195,732 shares of Common Stock owned by Pangaea. Mr. DeSorcy, as the holder of a controlling interest in Ortelius Advisors, may be deemed to beneficially own the 195,732 shares of Common Stock owned by Pangaea.

Contacts

MKA

Greg Marose / Charlotte Kiaie, 646-386-0091

gmarose@mkacomms.com / ckiaie@mkacomms.com