Document
P5YP1YP3Yfalse--12-31Q1202000017047200.00010.0001115000000115000000797279727972797279516833791303160.02250.0450P5Y1000000.00010.00011000000010000000000011400000211139597656 0001704720 2020-01-01 2020-03-31 0001704720 2020-04-30 0001704720 2020-03-31 0001704720 2019-12-31 0001704720 2019-01-01 2019-03-31 0001704720 cnne:RestaurantSalesMember 2019-01-01 2019-03-31 0001704720 cnne:TotalOtherOperatingRevenueMember 2019-01-01 2019-03-31 0001704720 cnne:TotalOtherOperatingRevenueMember 2020-01-01 2020-03-31 0001704720 cnne:RestaurantSalesMember 2020-01-01 2020-03-31 0001704720 us-gaap:RetainedEarningsMember 2019-12-31 0001704720 us-gaap:CommonStockMember 2020-03-31 0001704720 us-gaap:RetainedEarningsMember 2020-03-31 0001704720 us-gaap:CommonStockMember 2018-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-03-31 0001704720 us-gaap:NoncontrollingInterestMember 2020-01-01 2020-03-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember 2019-01-01 2019-03-31 0001704720 us-gaap:TreasuryStockMember 2019-03-31 0001704720 srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember 2020-01-01 2020-03-31 0001704720 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-12-31 0001704720 us-gaap:NoncontrollingInterestMember 2018-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember 2020-01-01 2020-03-31 0001704720 2019-01-01 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001704720 us-gaap:RetainedEarningsMember 2018-12-31 0001704720 us-gaap:AdditionalPaidInCapitalMember 2020-03-31 0001704720 us-gaap:TreasuryStockMember 2020-01-01 2020-03-31 0001704720 srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001704720 srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember 2019-01-01 2019-03-31 0001704720 us-gaap:TreasuryStockMember 2018-12-31 0001704720 us-gaap:NoncontrollingInterestMember 2020-03-31 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-01-01 2020-03-31 0001704720 us-gaap:CommonStockMember 2019-03-31 0001704720 us-gaap:RetainedEarningsMember 2019-01-01 0001704720 us-gaap:CommonStockMember 2019-12-31 0001704720 us-gaap:TreasuryStockMember 2020-03-31 0001704720 us-gaap:NoncontrollingInterestMember 2019-01-01 2019-03-31 0001704720 srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-03-31 0001704720 us-gaap:RetainedEarningsMember 2019-03-31 0001704720 us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001704720 us-gaap:NoncontrollingInterestMember 2019-12-31 0001704720 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-01 2019-03-31 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-03-31 0001704720 us-gaap:TreasuryStockMember 2019-12-31 0001704720 us-gaap:RetainedEarningsMember 2020-01-01 2020-03-31 0001704720 us-gaap:RetainedEarningsMember 2019-01-01 2019-03-31 0001704720 us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-03-31 0001704720 2018-12-31 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-03-31 0001704720 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-01 0001704720 us-gaap:NoncontrollingInterestMember 2019-03-31 0001704720 2019-03-31 0001704720 us-gaap:AdditionalPaidInCapitalMember 2019-03-31 0001704720 cnne:DunAndBradstreetCorporationMember 2020-01-01 2020-03-31 0001704720 cnne:InvestmentsExcludingDunBradstreetMember 2020-01-01 2020-03-31 0001704720 cnne:InvestmentsExcludingDunBradstreetMember 2019-01-01 2019-03-31 0001704720 cnne:DunAndBradstreetCorporationMember 2019-01-01 2019-03-31 0001704720 srt:RestatementAdjustmentMember 2019-01-01 2019-03-31 0001704720 srt:ScenarioPreviouslyReportedMember 2019-01-01 2019-03-31 0001704720 cnne:AmeriLifeJointVentureMember 2020-03-18 2020-03-18 0001704720 cnne:CeridianMember 2020-03-01 2020-03-31 0001704720 cnne:CeridianMember 2020-02-21 0001704720 cnne:AmericanBlueRibbonHoldingsLLCMember 2020-01-27 0001704720 cnne:AmeriLifeJointVentureMember 2020-03-18 0001704720 cnne:LimitedPartnershipEquityFundMember us-gaap:SubsequentEventMember 2020-04-01 2020-05-07 0001704720 cnne:CeridianMember srt:ScenarioForecastMember us-gaap:SubsequentEventMember 2020-05-08 2020-05-12 0001704720 cnne:AmericanBlueRibbonHoldingsLLCMember 2020-01-01 2020-03-31 0001704720 cnne:CeridianMember 2020-03-31 0001704720 cnne:AmericanBlueRibbonHoldingsLLCMember us-gaap:EquityMethodInvesteeMember 2020-03-31 0001704720 cnne:LimitedPartnershipEquityFundMember 2019-12-31 0001704720 cnne:CeridianMember 2020-02-21 2020-02-21 0001704720 cnne:LimitedPartnershipEquityFundMember 2020-01-01 2020-03-31 0001704720 cnne:CannaeTHLAndOtherInvestorsMember cnne:AmeriLifeJointVentureMember 2020-03-18 2020-03-18 0001704720 cnne:CeridianMember us-gaap:SubsequentEventMember 2020-05-08 2020-05-08 0001704720 cnne:LimitedPartnershipEquityFundMember 2019-12-01 2019-12-31 0001704720 cnne:FidelityNationalFinancialInc.Member 2017-11-17 2017-11-17 0001704720 us-gaap:FairValueInputsLevel3Member us-gaap:CorporateDebtSecuritiesMember 2018-12-31 0001704720 us-gaap:FairValueInputsLevel3Member us-gaap:CorporateDebtSecuritiesMember 2020-01-01 2020-03-31 0001704720 us-gaap:FairValueInputsLevel3Member us-gaap:CorporateDebtSecuritiesMember 2019-01-01 2019-03-31 0001704720 us-gaap:FairValueInputsLevel3Member us-gaap:CorporateDebtSecuritiesMember 2019-03-31 0001704720 us-gaap:FairValueInputsLevel3Member us-gaap:CorporateDebtSecuritiesMember 2019-12-31 0001704720 us-gaap:FairValueInputsLevel3Member us-gaap:CorporateDebtSecuritiesMember 2020-03-31 0001704720 us-gaap:FairValueInputsLevel1Member 2020-03-31 0001704720 us-gaap:FairValueInputsLevel2Member 2020-03-31 0001704720 us-gaap:FairValueInputsLevel3Member 2020-03-31 0001704720 srt:WeightedAverageMember us-gaap:FairValueInputsLevel3Member us-gaap:MeasurementInputDiscountRateMember 2020-03-31 0001704720 srt:MaximumMember us-gaap:FairValueInputsLevel3Member us-gaap:MeasurementInputDiscountRateMember 2020-03-31 0001704720 srt:MinimumMember us-gaap:FairValueInputsLevel3Member us-gaap:MeasurementInputDiscountRateMember 2020-03-31 0001704720 us-gaap:FairValueInputsLevel1Member 2019-12-31 0001704720 us-gaap:FairValueInputsLevel3Member 2019-12-31 0001704720 us-gaap:FairValueInputsLevel2Member 2019-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:LimitedPartnershipEquityFundMember 2020-01-01 2020-03-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:LimitedPartnershipEquityFundMember 2020-03-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:LimitedPartnershipEquityFundMember 2019-12-31 0001704720 us-gaap:CorporateDebtSecuritiesMember 2020-03-31 0001704720 us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:CorporateDebtSecuritiesMember 2020-03-31 0001704720 us-gaap:CarryingReportedAmountFairValueDisclosureMember 2020-03-31 0001704720 us-gaap:CorporateDebtSecuritiesMember 2019-12-31 0001704720 us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:CorporateDebtSecuritiesMember 2019-12-31 0001704720 us-gaap:CarryingReportedAmountFairValueDisclosureMember 2019-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:DunAndBradstreetCorporationMember 2019-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:DunAndBradstreetCorporationMember 2020-03-31 0001704720 cnne:QOMPLXInc.Member 2020-03-31 0001704720 cnne:LimitedPartnershipEquityFundMember 2019-12-01 2020-03-31 0001704720 cnne:CeridianMember 2019-12-31 0001704720 cnne:DunAndBradstreetCorporationMember 2020-03-31 0001704720 cnne:CeridianMember 2020-03-31 0001704720 cnne:OtherInvestmentsInUnconsolidatedAffiliatesMember 2019-12-31 0001704720 cnne:OtherInvestmentsInUnconsolidatedAffiliatesMember 2020-03-31 0001704720 cnne:LimitedPartnershipEquityFundMember 2020-03-31 0001704720 cnne:AmeriLifeJointVentureMember 2020-03-31 0001704720 cnne:AmeriLifeJointVentureMember 2019-12-31 0001704720 cnne:DunAndBradstreetCorporationMember 2019-12-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:DunAndBradstreetCorporationMember 2020-01-01 2020-03-31 0001704720 cnne:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember cnne:DunAndBradstreetCorporationMember 2019-01-01 2019-03-31 0001704720 cnne:OtherInvestmentsInUnconsolidatedAffiliatesMember 2019-01-01 2019-03-31 0001704720 cnne:OtherInvestmentsInUnconsolidatedAffiliatesMember 2020-01-01 2020-03-31 0001704720 cnne:CeridianMember 2019-01-01 2019-03-31 0001704720 cnne:AmeriLifeJointVentureMember 2019-01-01 2019-03-31 0001704720 cnne:AmeriLifeJointVentureMember 2020-01-01 2020-03-31 0001704720 cnne:CeridianMember 2020-01-01 2020-03-31 0001704720 cnne:LimitedPartnershipEquityFundMember 2019-01-01 2019-03-31 0001704720 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember 2019-12-31 0001704720 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember 2020-03-31 0001704720 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember cnne:AmericanBlueRibbonHoldingsLLCMember us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember 2020-03-31 0001704720 cnne:A99TermLoanMember us-gaap:NotesPayableToBanksMember 2020-03-31 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember us-gaap:NotesPayableToBanksMember 2020-03-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2020-02-18 2020-02-18 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember cnne:NotesPayableToBanksAcquisitionLoanMember 2016-01-29 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2019-11-13 2019-11-13 0001704720 cnne:NinetyNineRestaurantsMember cnne:A99TermLoanMember 2018-12-21 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:CorporateRevolverNoteMember 2017-11-17 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember 2016-01-29 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:CorporateRevolverNoteMember 2020-03-31 0001704720 cnne:NinetyNineRestaurantsMember us-gaap:RevolvingCreditFacilityMember cnne:A99RestaurantsCreditFacilityMember us-gaap:BaseRateMember 2018-12-21 2018-12-21 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2018-11-07 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember cnne:NotesPayableToBanksAcquisitionLoanANoteMember 2016-01-29 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2018-11-07 2018-11-07 0001704720 cnne:FNFNVBrasadaLLCMember us-gaap:LineOfCreditMember cnne:BrasadaCreditAgreementMember 2018-06-13 0001704720 cnne:NinetyNineRestaurantsMember us-gaap:RevolvingCreditFacilityMember cnne:A99RestaurantsCreditFacilityMember us-gaap:LondonInterbankOfferedRateLIBORMember 2018-12-21 2018-12-21 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementNoteCMember us-gaap:NotesPayableToBanksMember 2020-03-31 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember cnne:NotesPayableToBanksDevelopmentLoanMember 2016-01-29 0001704720 cnne:FNFNVBrasadaLLCMember us-gaap:LineOfCreditMember cnne:BrasadaCreditAgreementMember 2020-03-31 0001704720 cnne:FNFNVBrasadaLLCMember us-gaap:LineOfCreditMember cnne:BrasadaCreditAgreementMember 2016-01-29 0001704720 cnne:NinetyNineRestaurantsMember us-gaap:RevolvingCreditFacilityMember cnne:A99RestaurantsCreditFacilityMember 2020-03-31 0001704720 cnne:NinetyNineRestaurantsMember us-gaap:LineOfCreditMember cnne:DevelopmentLineOfCreditLoanMember 2018-12-21 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember cnne:NotesPayableToBanksAcquisitionLoanBNoteMember 2016-01-29 0001704720 cnne:NinetyNineRestaurantsMember us-gaap:RevolvingCreditFacilityMember cnne:A99RestaurantsCreditFacilityMember 2018-12-21 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2019-12-18 2019-12-18 0001704720 cnne:BrasadaCreditAgreementMember us-gaap:NotesPayableToBanksMember 2019-12-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:A99RestaurantsCreditFacilityMember 2020-03-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2020-03-31 0001704720 cnne:BrasadaCreditAgreementMember us-gaap:NotesPayableToBanksMember 2020-03-31 0001704720 cnne:DevelopmentLineOfCreditLoanMember 2020-03-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:MarginLoanAgreementMember 2019-12-31 0001704720 cnne:OtherNotesPayableMember us-gaap:NotesPayableOtherPayablesMember 2020-03-31 0001704720 cnne:OtherNotesPayableMember us-gaap:NotesPayableOtherPayablesMember 2019-12-31 0001704720 cnne:DevelopmentLineOfCreditLoanMember 2019-12-31 0001704720 cnne:A99TermLoanMember us-gaap:NotesPayableToBanksMember 2019-12-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:A99RestaurantsCreditFacilityMember 2019-12-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:CorporateRevolverNoteMember 2019-12-31 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:CorporateRevolverNoteMember 2017-11-17 2017-11-17 0001704720 cnne:FNFNVBrasadaLLCMember cnne:BrasadaCreditAgreementMember cnne:NotesPayableToBanksAcquisitionLoanBNoteMember us-gaap:LondonInterbankOfferedRateLIBORMember 2016-01-29 2016-01-29 0001704720 us-gaap:RevolvingCreditFacilityMember cnne:CorporateRevolverNoteMember us-gaap:LondonInterbankOfferedRateLIBORMember 2017-11-17 2017-11-17 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantGroupMember 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:TotalOtherOperatingRevenueMember cnne:DunAndBradstreetCorporationMember 2020-01-01 2020-03-31 0001704720 us-gaap:IntersegmentEliminationMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember us-gaap:CorporateAndOtherMember 2020-03-31 0001704720 us-gaap:IntersegmentEliminationMember 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember us-gaap:CorporateAndOtherMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantSalesMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:DunAndBradstreetCorporationMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantSalesMember us-gaap:CorporateAndOtherMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:TotalOtherOperatingRevenueMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:TotalOtherOperatingRevenueMember us-gaap:CorporateAndOtherMember 2020-01-01 2020-03-31 0001704720 us-gaap:IntersegmentEliminationMember cnne:RestaurantSalesMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantSalesMember cnne:DunAndBradstreetCorporationMember 2020-01-01 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:DunAndBradstreetCorporationMember 2020-03-31 0001704720 us-gaap:IntersegmentEliminationMember cnne:TotalOtherOperatingRevenueMember 2020-01-01 2020-03-31 0001704720 2019-01-01 2019-12-31 0001704720 cnne:AmericanBlueRibbonHoldingsLLCMember 2020-03-31 0001704720 cnne:NinetyNineRestaurantsMember 2020-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:DunAndBradstreetCorporationMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantSalesMember cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember us-gaap:CorporateAndOtherMember 2019-01-01 2019-03-31 0001704720 us-gaap:IntersegmentEliminationMember 2019-03-31 0001704720 us-gaap:IntersegmentEliminationMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:TotalOtherOperatingRevenueMember us-gaap:CorporateAndOtherMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantGroupMember 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantSalesMember us-gaap:CorporateAndOtherMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember us-gaap:CorporateAndOtherMember 2019-03-31 0001704720 us-gaap:IntersegmentEliminationMember cnne:TotalOtherOperatingRevenueMember 2019-01-01 2019-03-31 0001704720 us-gaap:IntersegmentEliminationMember cnne:RestaurantSalesMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:TotalOtherOperatingRevenueMember cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:RestaurantSalesMember cnne:DunAndBradstreetCorporationMember 2019-01-01 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:DunAndBradstreetCorporationMember 2019-03-31 0001704720 us-gaap:OperatingSegmentsMember cnne:TotalOtherOperatingRevenueMember cnne:DunAndBradstreetCorporationMember 2019-01-01 2019-03-31 0001704720 cnne:FranchiseAndOtherMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 cnne:BakerySalesMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 cnne:OtherProductsAndServicesMember us-gaap:CorporateAndOtherMember 2019-01-01 2019-03-31 0001704720 cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 cnne:FranchiseAndOtherMember cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 cnne:RealEstateAndResortMember us-gaap:CorporateAndOtherMember 2019-01-01 2019-03-31 0001704720 cnne:OtherProductsAndServicesMember us-gaap:CorporateAndOtherMember 2020-01-01 2020-03-31 0001704720 cnne:RealEstateAndResortMember us-gaap:CorporateAndOtherMember 2020-01-01 2020-03-31 0001704720 cnne:RestaurantSalesMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 cnne:BakerySalesMember cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 cnne:RestaurantSalesMember cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 cnne:TotalOtherOperatingRevenueMember 2020-01-01 2020-03-31 0001704720 cnne:RestaurantGroupMember 2019-01-01 2019-03-31 0001704720 cnne:TotalOtherOperatingRevenueMember 2019-01-01 2019-03-31 0001704720 cnne:RestaurantGroupMember 2020-03-31 0001704720 us-gaap:CorporateAndOtherMember 2019-12-31 0001704720 us-gaap:CorporateAndOtherMember 2020-01-01 2020-03-31 0001704720 cnne:RestaurantGroupMember 2019-12-31 0001704720 us-gaap:CorporateAndOtherMember 2020-03-31 0001704720 us-gaap:TradeNamesMember cnne:RestaurantGroupMember 2020-01-01 2020-03-31 0001704720 us-gaap:DiscontinuedOperationsHeldforsaleMember cnne:TSystemHoldingsInc.Member 2019-01-01 2019-03-31 0001704720 cnne:CodingSolutionsMember us-gaap:DiscontinuedOperationsHeldforsaleMember cnne:TSystemHoldingsInc.Member 2019-12-31 2019-12-31 xbrli:shares xbrli:pure cnne:record iso4217:USD xbrli:shares iso4217:USD


 
 
 
 
 
 
 
 
 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020

OR
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-38300
CANNAE HOLDINGS, INC.
______________________________________________________________________________________________________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware
 
82-1273460
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification Number)
 
 
 
 
 
 
 
1701 Village Center Circle,
 
Las Vegas,
 
Nevada
 
89134
(Address of principal executive offices)
 
(Zip Code)
(702) 323-7330
___________________________________________________________________
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
 
Trading Symbol
 
Name of Each Exchange on Which Registered
Cannae Common Stock, $0.0001 par value
 
CNNE
 
New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes NO
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit). Yes NO
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer," “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):
Large Accelerated Filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES NO
As of April 30, 2020 there were 79,006,724 shares of the Registrant's common stock outstanding.

 
 
 
 
 
 
 
 
 
 



FORM 10-Q
QUARTERLY REPORT
Quarter Ended March 31, 2020
TABLE OF CONTENTS
 
 
 
Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


i




Part I: FINANCIAL INFORMATION

Item 1.
Condensed Consolidated Financial Statements

CANNAE HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
(Unaudited)
 
March 31,
2020

December 31,
2019
 
 
 
 
ASSETS
Current assets:
 

 
 

Cash and cash equivalents
$
444.3

 
$
533.7

Short-term investments
0.8

 
0.5

Trade receivables
3.2

 
16.0

Inventory
8.1

 
16.3

Prepaid expenses and other current assets
35.0

 
64.4

Total current assets
491.4

 
630.9

Investment in Ceridian, at fair value - see Note A
993.4

 

Investments in unconsolidated affiliates
759.2

 
836.5

Lease assets
145.0

 
192.9

Property and equipment, net
137.9

 
162.6

Other intangible assets, net
38.3

 
63.1

Goodwill
53.5

 
66.1

Fixed maturity securities available for sale, at fair value
26.1

 
19.2

Deferred tax asset

 
54.5

Other long term investments and non-current assets
60.3

 
66.4

Total assets
$
2,705.1

 
$
2,092.2

 
 
 
 
LIABILITIES AND EQUITY
Current liabilities:
 

 
 

Accounts payable and other accrued liabilities, current
$
57.8

 
$
86.4

Lease liabilities, current
26.7

 
41.5

Income taxes payable
45.1

 
37.4

Deferred revenue
16.2

 
26.4

Notes payable, current
6.3

 
7.0

Total current liabilities
152.1

 
198.7

Lease liabilities, long term
138.4

 
199.7

Deferred tax liability
124.5

 

Notes payable, long term
42.6

 
120.1

Accounts payable and other accrued liabilities, long term
42.5

 
43.9

Total liabilities
500.1

 
562.4

Commitments and contingencies - see Note G


 


Equity:
 

 
 
Cannae common stock, $0.0001 par value; authorized 115,000,000 shares as of March 31, 2020 and December 31, 2019; outstanding of 79,130,316 and 79,516,833 shares as of March 31, 2020 and December 31, 2019, respectively, and issued of 79,727,972 shares as of March 31, 2020 and December 31, 2019, respectively

 

Preferred stock, $0.0001 par value; authorized 10,000,000 shares; issued and outstanding, none as of March 31, 2020 and December 31, 2019

 

Retained earnings
791.3

 
143.6

Additional paid-in capital
1,406.1

 
1,396.7

Less: Treasury stock, 597,656 and 211,139 shares as of March 31, 2020 and December 31, 2019, respectively, at cost
(16.7
)
 
(5.9
)
Accumulated other comprehensive loss
(0.2
)
 
(45.9
)
Total Cannae shareholders' equity
2,180.5

 
1,488.5

Noncontrolling interests
24.5

 
41.3

Total equity
2,205.0

 
1,529.8

Total liabilities and equity
$
2,705.1

 
$
2,092.2

See Notes to Condensed Consolidated Financial Statements

1



CANNAE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions)
(Unaudited)

Three months ended March 31,
 
2020
 
2019
 

Revenues:
 
Restaurant revenue
$
169.9

 
$
257.8

Other operating revenue
3.1

 
4.5

Total operating revenues
173.0

 
262.3

Operating expenses:
 
 
 
Cost of restaurant revenue
153.1

 
227.0

Personnel costs
29.2

 
16.1

Depreciation and amortization
8.4

 
10.4

Other operating expenses
27.9

 
19.9

Goodwill impairment
7.7

 

Total operating expenses
226.3

 
273.4

Operating loss
(53.3
)
 
(11.1
)
Other income (expense):
 
 
 
Interest, investment and other income
2.2

 
11.0

Interest expense
(3.8
)
 
(3.7
)
Realized and other gains and losses, net
915.1

 
1.6

Total other income
913.5

 
8.9

Earnings (loss) before income taxes and equity in losses of unconsolidated affiliates
860.2

 
(2.2
)
Income tax expense (benefit)
169.4

 
(6.0
)
Earnings before equity in losses of unconsolidated affiliates
690.8

 
3.8

Equity in losses of unconsolidated affiliates
(52.7
)
 
(21.4
)
Earnings (loss) from continuing operations
638.1

 
(17.6
)
Net losses from discontinued operations, net of tax - see Note L

 
(2.3
)
Net earnings (loss)
638.1

 
(19.9
)
Less: Net loss attributable to non-controlling interests
(9.6
)
 
(3.1
)
Net earnings (loss) attributable to Cannae Holdings, Inc. common shareholders
$
647.7

 
$
(16.8
)
Amounts attributable to Cannae Holdings, Inc. common shareholders
 
 
 
Net earnings (loss) from continuing operations attributable to Cannae Holdings, Inc. common shareholders
$
647.7

 
$
(14.8
)
Net loss from discontinued operations attributable to Cannae Holdings, Inc. common shareholders

 
(2.0
)
Net earnings (loss) attributable to Cannae Holdings, Inc. common shareholders
$
647.7

 
$
(16.8
)
Earnings per share
 
 
 
Basic
 
 
 
Net earnings (loss) per share from continuing operations
$
8.19

 
$
(0.21
)
Net loss per share from discontinued operations

 
(0.03
)
Net earnings (loss) per share
$
8.19

 
$
(0.24
)
Diluted

 

Net earnings (loss) per share from continuing operations
$
8.17

 
$
(0.21
)
Net loss per share from discontinued operations

 
(0.03
)
Net earnings (loss) per share
$
8.17

 
$
(0.24
)
Weighted Average Shares Outstanding
 
 
 
Weighted average shares outstanding Cannae Holdings common stock, basic basis
79.1

 
71.6

Weighted average shares outstanding Cannae Holdings common stock, diluted basis
79.3

 
71.6


See Notes to Condensed Consolidated Financial Statements

2



CANNAE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS)
(In millions)
(Unaudited)

 
Three months ended March 31,
 
2020
 
2019
Net earnings (loss)
$
638.1

 
$
(19.9
)
Other comprehensive earnings (loss), net of tax:
 

 
 

Unrealized gain (loss) on investments and other financial instruments, net (excluding investments in unconsolidated affiliates) (1)
5.3

 
(0.2
)
Unrealized (loss) gain relating to investments in unconsolidated affiliates (2)
(3.9
)
 
5.9

Reclassification adjustments for unrealized gains and losses on unconsolidated affiliates, net of tax, included in net earnings (3)
44.3

 
0.6

Other comprehensive earnings
45.7

 
6.3

Comprehensive earnings (loss)
683.8

 
(13.6
)
Less: Comprehensive loss attributable to noncontrolling interests
(9.6
)
 
(3.1
)
Comprehensive earnings (loss) attributable to Cannae Holdings, Inc.
$
693.4

 
$
(10.5
)

_________________________________
 
(1)
Net of income tax expense (benefit) of $1.4 million and $(0.1) million for the three months ended March 31, 2020 and 2019, respectively.
(2)
Net of income tax (benefit) expense of $(1.0) million and $1.6 million for the three months ended March 31, 2020 and 2019, respectively.
(3)
Net of income tax expense of $11.8 million and $0.2 million for the three months ended March 31, 2020 and 2019, respectively
    
See Notes to Condensed Consolidated Financial Statements




3



CANNAE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(In millions)
(Unaudited)

 
Common Stock
 
Additional Paid-in Capital
 
Retained Earnings
 
Accumulated Other Comp (Loss) Earnings
 
Treasury Stock
 
Non-controlling
Interests
 
Total
Equity
 
Shares
 
$
 
 
 
 
Shares
 
$
 
 
 
 
 
 
 
 
Balance, December 31, 2018
72.2

 
$

 
$
1,146.2

 
$
45.8

 
$
(67.2
)
 

 
$
(0.2
)
 
$
75.1

 
$
1,199.7

Adjustment for cumulative effect of adoption of accounting standards by unconsolidated affiliates

 

 

 
20.5

 
(5.0
)
 

 

 

 
15.5

Other comprehensive earnings — unrealized loss on investments and other financial instruments, net of tax

 

 

 

 
(0.2
)
 

 

 

 
(0.2
)
Other comprehensive earnings — unrealized earnings of investments in unconsolidated affiliates, net of tax

 

 

 

 
5.9

 

 

 

 
5.9

Reclassification adjustments for unrealized gains and losses on unconsolidated affiliates, net of tax, included in net earnings

 

 

 

 
0.6

 

 

 

 
0.6

Dun & Bradstreet equity issuance costs

 

 
(1.4
)
 

 

 

 

 

 
(1.4
)
Stock-based compensation, consolidated subsidiaries

 

 
0.9

 

 

 

 

 

 
0.9

Contribution of CSA services from FNF

 

 
0.3

 

 

 

 

 

 
0.3

Stock-based compensation, unconsolidated affiliates

 

 
1.5

 

 

 

 

 

 
1.5

Subsidiary dividends paid to noncontrolling interests

 

 

 

 

 

 

 
(0.4
)
 
(0.4
)
Net loss

 

 

 
(16.8
)
 

 

 

 
(3.1
)
 
(19.9
)
Balance, March 31, 2019
72.2

 
$

 
$
1,147.5

 
$
49.5

 
$
(65.9
)
 

 
$
(0.2
)
 
$
71.6

 
$
1,202.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, December 31, 2019
79.7

 
$

 
$
1,396.7

 
$
143.6

 
$
(45.9
)
 
0.2

 
$
(5.9
)
 
$
41.3

 
$
1,529.8

Restaurant Group reorganization and deconsolidation of Blue Ribbon

 

 
5.2

 

 

 

 

 
(10.3
)
 
(5.1
)
Other comprehensive earnings — unrealized gain on investments and other financial instruments, net of tax

 

 

 

 
5.3

 

 

 

 
5.3

Other comprehensive earnings — unrealized losses of investments in unconsolidated affiliates, net of tax

 

 

 

 
(3.9
)
 

 

 

 
(3.9
)
Reclassification adjustments for unrealized gains and losses on unconsolidated affiliates, net of tax, included in net earnings

 

 

 

 
44.3

 

 

 

 
44.3

Sale of noncontrolling interest in consolidated subsidiary

 

 

 

 

 

 

 
3.1

 
3.1

Treasury stock repurchases

 

 

 

 

 
0.4

 
(10.8
)
 

 
(10.8
)
Stock-based compensation, consolidated subsidiaries

 

 
1.1

 

 

 

 

 

 
1.1

Contribution of CSA services from FNF

 

 
0.4

 

 

 

 

 

 
0.4

Stock-based compensation, unconsolidated affiliates

 

 
2.7

 

 

 

 

 

 
2.7

Net earnings (loss)

 

 

 
647.7

 

 

 

 
(9.6
)
 
638.1

Balance, March 31, 2020
79.7

 
$

 
$
1,406.1

 
$
791.3

 
$
(0.2
)
 
0.6

 
$
(16.7
)
 
$
24.5

 
$
2,205.0


See Notes to Condensed Consolidated Financial Statements


4



CANNAE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
 
Three months ended March 31,
 
 
2020
 
2019
 
 
 
 
Cash flows from operating activities:
 
 
 
Net earnings (loss)
$
638.1

 
$
(19.9
)
Adjustments to reconcile net earnings (loss) to net cash (used in) provided by operating activities:
 
 
 
            Depreciation and amortization
8.4

 
13.9

            Equity in losses of unconsolidated affiliates
52.7

 
21.4

            Distributions from investments in unconsolidated affiliates
0.5

 
2.0

            Realized and other gains and losses and asset impairments, net
(902.0
)
 
(1.4
)
            Lease asset amortization
6.2

 
9.9

            Stock-based compensation cost
1.1

 
0.9

Changes in assets and liabilities, net of effects from acquisitions:
 
 
 
Net decrease in trade receivables
8.7

 
20.2

Net increase in inventory, prepaid expenses and other assets
(10.9
)
 
(10.1
)
Net decrease in lease liabilities
(8.2
)
 
(10.9
)
Net decrease (increase) in accounts payable, accrued liabilities, deferred revenue and other
2.0

 
(12.3
)
Net change in income taxes
169.1

 
(7.7
)
Net cash (used in) provided by operating activities
(34.3
)
 
6.0

Cash flows from investing activities:
 
 
 
Proceeds from sale of investment securities and investments in unconsolidated affiliates

 
1.7

Proceeds from partial sale of Ceridian shares - see Note A
283.7

 

Additions to property and equipment and other intangible assets
(13.6
)
 
(3.2
)
Additions to notes receivable
(11.2
)
 

Proceeds from sales of property and equipment

 
2.9

Investments in Dun & Bradstreet, net of capitalized syndication fees

 
(502.7
)
Additional investments in unconsolidated affiliates
(226.2
)
 

Cash deconsolidated through the Blue Ribbon Reorganization - see Note A
(1.1
)
 

Distributions from investments in unconsolidated affiliates

 
0.3

Net proceeds from sales and maturities of short-term investment securities
(0.3
)
 
19.2

Net cash provided by (used in) investing activities
31.3

 
(481.8
)
Cash flows from financing activities:
 
 
 
Borrowings
12.5

 
262.2

Debt service payments
(91.2
)
 
(1.0
)
Subsidiary distributions paid to noncontrolling interest shareholders

 
(0.4
)
Sale of noncontrolling interest in consolidated subsidiary
3.1

 

Treasury stock repurchases
(10.8
)
 

Proceeds from Restaurant Group sale and leaseback of corporate office, net of issuance costs

 
13.2

Net cash (used in) provided by financing activities
(86.4
)
 
274.0

Net decrease in cash and cash equivalents
(89.4
)
 
(201.8
)
Cash and cash equivalents at beginning of period
533.7

 
323.0

Cash and cash equivalents at end of period
$
444.3

 
$
121.2


See Notes to Condensed Consolidated Financial Statements

5



CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note A — Basis of Financial Statements
The following describes the significant accounting policies of Cannae Holdings, Inc. and its subsidiaries (collectively, “we,” “us,” “our,” "Cannae," "CNNE," or the "Company”) which have been followed in preparing the accompanying Condensed Consolidated Financial Statements.
Description of the Business
We are a holding company engaged in actively managing and operating a group of companies and investments, as well as making additional majority and minority equity portfolio investments in businesses, in order to achieve superior financial performance and maximize the value of these assets. Our primary investments as of March 31, 2020 include our minority ownership interests in The Dun & Bradstreet Corporation ("Dun & Bradstreet" or "D&B"), Ceridian HCM Holding, Inc. ("Ceridian") and AmeriLife Group, LLC ("AmeriLife"); majority equity ownership stakes in O'Charley's Holdings, LLC ("O'Charley's") and 99 Restaurants Holdings, LLC ("99 Restaurants"); and various other controlled portfolio companies and minority equity and debt investments.
See Note H for further discussion of the businesses comprising our reportable segments.
The Company conducts its business through its wholly-owned subsidiary Cannae Holdings, LLC ("Cannae LLC"), a Delaware limited liability company. The Company’s board of directors ("Board") oversees the management of the Company, Cannae LLC and its businesses, and the performance of Trasimene Capital Management, LLC (“Trasimene” or the “Manager”). In connection with the externalization of certain of our management functions in September 2019, the Company, Cannae LLC, and the Manager entered into a Management Services Agreement (the “Management Services Agreement”).
Principles of Consolidation and Basis of Presentation
The accompanying Condensed Consolidated Financial Statements are prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and the instructions to Form 10-Q and Article 10 of Regulation S-X and include the historical accounts as well as wholly-owned and majority-owned subsidiaries of the Company. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All adjustments made were of a normal, recurring nature. This report should be read in conjunction with our Annual Report on Form 10-K (our "Annual Report") for the year ended December 31, 2019.
Following the split-off of the former portfolio company investments by Fidelity National Financial, Inc. ("FNF"), and subsequent contribution to us (the "FNF Split-Off"), the Company is allocated certain corporate overhead and management services expenses from FNF based on the terms of the Corporate Services Agreement ("CSA"), dated as of November 17, 2017, by and between the Company and FNF and our proportionate share of the expense determined on actual usage and our best estimate of management's allocation of time. The CSA has an initial three-year term and after the initial three-year term, if the CSA is not mutually terminated by us or FNF prior to the expiration of the initial three-year term, it will automatically renew for successive one-year terms on mutually agreeable arm's length terms unless FNF and Cannae mutually agree to terminate the agreement. Both FNF and Cannae believe expense allocations pursuant to the CSA are reasonable; however, they may not be indicative of the actual results of operations or cash flows of the Company had the Company been operating as an independent, publicly-traded company for the periods presented or the amounts that will be incurred by the Company in the future. FNF is considered a related party to the Company.
All intercompany profits, transactions and balances have been eliminated. Our investments in non-majority-owned partnerships and affiliates are accounted for using the equity method until such time that they may become wholly or majority-owned. Earnings attributable to noncontrolling interests are recorded on the Condensed Consolidated Statements of Operations relating to majority-owned subsidiaries with the appropriate noncontrolling interest that represents the portion of equity not related to our ownership interest recorded on the Condensed Consolidated Balance Sheets in each period.
Management Estimates
The preparation of these Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates made by management include the valuation of goodwill and acquired intangible assets and fair value measurements (Note C). Actual results may differ from estimates.

6

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

Recent Developments
Ceridian
On February 21, 2020, we completed the sale of an additional 3.9 million shares of common stock of Ceridian to a broker pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended. In connection with the sale, we received proceeds of $283.7 million and recorded a gain of $223.1 million. As a result of the sale, we now own 19.8 million shares of Ceridian which represents 13.7% of its outstanding common stock.
As of March 31, 2020 our voting agreement with Ceridian was terminated and, as a result, we are no longer able to exert influence over the composition and quantity of Ceridian's board of directors. In combination with the reduction in our ownership of Ceridian resulting from the sale of shares in February 2020, we no longer exercise significant influence over Ceridian. As of March 31, 2020, we account for our investment in Ceridian pursuant to the investment in equity security guidance of Accounting Standards Codification ("ASC") 321. The change resulted in the revaluation of our investment in Ceridian to its fair value of $993.4 million as of March 31, 2020 and recording a gain on such revaluation of $684.9 million. Refer to Notes C and D for further discussion of our accounting for our investment in Ceridian.
On May 8, 2020, we sold 1.8 million shares of common stock of Ceridian to a broker pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended. We expect to receive proceeds of $115.9 million on May 12, 2020.
Restaurant Group
On January 27, 2020, American Blue Ribbon Holdings, LLC ("Blue Ribbon") and its wholly-owned subsidiaries, filed voluntary petitions for relief under chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware (the "Blue Ribbon Reorganization"). The Blue Ribbon Reorganization does not involve or affect the operations of O’Charley’s or 99 Restaurants, which are not part of Blue Ribbon.
As a result of the Blue Ribbon Reorganization, we deconsolidated Blue Ribbon as of January 27, 2020 because the bankruptcy court and committee of creditors formed are deemed to have control of Blue Ribbon. We continue to own 65.4% of the equity of Blue Ribbon and we have agreed to provide debtor-in-possession financing (the "DIP Loan") of up to $20.0 million to Blue Ribbon and its subsidiaries.
We recorded a gain of $26.5 million on January 27, 2020 as a result of the deconsolidation of Blue Ribbon which is included in Realized and other gains and losses, net on the Condensed Consolidated Statement of Operations. The recorded gain was measured as the excess of the fair value of our retained equity investment in Blue Ribbon over our book value of Blue Ribbon as of January 27, 2020.
We account for our retained equity interest in Blue Ribbon under the equity method of accounting because (1) we continue to exert significant influence over Blue Ribbon through our majority equity ownership and position as the single largest post-petition creditor of Blue Ribbon through the DIP Loan, (2) the Blue Ribbon Reorganization is limited in scope and is expected to be short in duration, and (3) we expect to retain our equity interest upon completion of the Blue Ribbon Reorganization. We recorded an investment of $33.6 million as of January 27, 2020. The fair value of the investment was determined by performing a combination of discounted cash flow and market approaches.
As a result of unprecedented social restrictions imposed by state and local government authorities related to the novel coronavirus ("COVID-19") pandemic, our Restaurant Group brands experienced a significant reduction in guest counts beginning in the last two weeks of March 2020. In response to the outbreak and these changing conditions, our Restaurant Group brands closed the dining rooms in substantially all of our restaurants, with limited exceptions related to stores that have reopened in states which have relaxed restrictions in late April and May 2020. As of the filing of this report, in most of our restaurants we are solely operating to-go and delivery services where able. Due to increased uncertainty in the operating environment for restaurants and a significant reduction in forecasted cash flows for Blue Ribbon, we recorded an other-than-temporary impairment of our investment of $18.6 million as of March 31, 2020.
Refer to Note D for further discussion of our investments in unconsolidated affiliates.
As of March 31, 2020, we have provided $11.0 million of financing to Blue Ribbon and its subsidiaries under the DIP Loan which is included in Prepaid expenses and other current assets on the Condensed Consolidated Balance Sheet.
AmeriLife
On March 18, 2020, we closed on the previously announced $125.0 million investment in a partnership (the “AmeriLife Joint Venture”) which invested in the recapitalization of AmeriLife. Cannae and other investors provided an aggregate of $617.0 million

7

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

in equity financing to the AmeriLife Joint Venture to acquire AmeriLife. AmeriLife is a leader in marketing and distributing life, health, and retirement solutions. The Company's $125.0 million investment represents 20.3% of the outstanding equity of the AmeriLife Joint Venture. We account for our investment in the AmeriLife Joint Venture under the equity method of accounting and the investment is included in Investments in unconsolidated affiliates on our Condensed Consolidated Balance Sheet as of March 31, 2020. Refer to Note D for further discussion of our investments in unconsolidated affiliates.
Equity Fund
On December 12, 2019, we entered into a limited partnership with an investment fund manager designed to opportunistically trade in marketable securities (the "Equity Fund"). In December 2019, we initially contributed $90.9 million of cash in exchange for limited partnership interests in the Equity Fund representing 49.0% of its outstanding equity and a deposit on hand with the Equity Fund. In the three months ended March 31, 2020, we invested an additional $101.2 million in the Equity Fund. Subsequent to March 31, 2020, we invested an additional $50.0 million in the Equity Fund. Refer to Note D for further discussion.
Earnings Per Share
Basic earnings per share, as presented on the Condensed Consolidated Statement of Operations, is computed by dividing net earnings available to common shareholders by the weighted average number of common shares outstanding during the period.
In periods when earnings are positive, diluted earnings per share is calculated by dividing net earnings available to common shareholders by the weighted average number of common shares outstanding plus the impact of assumed conversions of potentially dilutive securities. For periods when we recognize a net loss, diluted earnings per share is equal to basic earnings per share as the impact of assumed conversions of potentially dilutive securities is considered to be antidilutive. We have granted certain shares of restricted stock which have been treated as common share equivalents for purposes of calculating diluted earnings per share for periods in which positive earnings have been reported.
Instruments that provide the ability to purchase shares of our common stock that are antidilutive are excluded from the computation of diluted earnings per share. For the three months ended March 31, 2020 there were no antidilutive shares of restricted stock outstanding which were excluded from the calculation of diluted earnings per share. For the three months ended March 31, 2019 there were 0.2 million antidilutive shares of restricted stock outstanding which were excluded from the calculation of diluted earnings per share.
Income Tax
Income tax expense (benefit) was $169.4 million and $(6.0) million in the three-month periods ended March 31, 2020 and 2019, respectively. Our effective tax rate was 19.7% and 272.7% in the three months ended March 31, 2020 and 2019, respectively. The change in the effective tax rate in the three-month period ended March 31, 2020 was primarily attributable to the reduced impact of equity in losses of unconsolidated affiliates on pretax earnings in 2020 compared to the impact of equity in losses of unconsolidated affiliates on pretax losses in the same period in the 2019. We have a Deferred tax liability of $124.5 million as of March 31, 2020 and a Deferred tax asset of $54.5 million as of December 31, 2019. The $179.0 million change in deferred taxes in the three months ended March 31, 2020 is primarily attributable to the tax impact on the gain recorded for the change in accounting for Ceridian as of March 31, 2020.
Restricted Cash
Our Restaurant Group is required to hold cash collateralizing its outstanding letters of credit. Included in Cash and cash equivalents on our Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019 is $11.4 million of such restricted cash.
Recent Accounting Pronouncements
In December 2019, the FASB issued ASU 2019-12 Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740), which simplifies various aspects of the income tax accounting guidance and will be applied using different approaches depending on what the specific amendment relates to and, for public entities, are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. We are still evaluating the impact of this guidance and have not yet concluded on its anticipated impact on our Condensed Consolidated Financial Statements and related disclosures upon adoption.
Change in Accounting Principle
We historically accounted for our investment and proportionate share of losses in Dun & Bradstreet utilizing a three-month reporting lag due to timeliness considerations. In the third quarter of 2019, the Company was able to obtain financial information

8

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

for Dun & Bradstreet on a more timely basis and determined it was preferable to record our investment in Dun & Bradstreet on a current basis as opposed to the previous three-month lag.
In accordance with applicable accounting literature, a change to eliminate a previously existing reporting lag is considered a change in accounting principle. Changes in accounting principles are to be reported through retrospective application of the new principle to all prior financial statement periods presented. Accordingly, the Company's condensed consolidated financial statements for the interim periods of fiscal year 2019 were adjusted in the third quarter of 2019 to reflect the period specific effects of eliminating the three-month reporting lag. The elimination of the three-month reporting lag did not impact total operating, investing or financing cash flows for any period presented.
The elimination of the three-month reporting lag for our equity investment in Dun & Bradstreet resulted in the adjustments as of and for the periods indicated below (in millions, except per share amounts).
 
Three Months Ended
 
March 31, 2019
 
As Previously Reported
 
As Adjusted
 
Difference
 
(in millions, except per share amounts)
Condensed Consolidated Statements of Operations
 
 
 
 
 
Income tax benefit
$
(4.8
)
 
$
(7.2
)
 
$
(2.4
)
Equity in earnings (losses) of unconsolidated affiliates
2.9

 
(21.4
)
 
(24.3
)
Net earnings (loss)
2.0

 
(19.9
)
 
(21.9
)
Net earnings (loss) attributable to Cannae Holdings
$
5.1

 
$
(16.8
)
 
$
(21.9
)
Per Share Data:
 
 
 
 
 
Basic
 
 
 
 
 
Basic earnings (loss) per share attributable to Cannae Holdings common shareholders
$
0.07

 
$
(0.24
)
 
$
(0.31
)
Diluted
 
 
 
 
 
Diluted earnings (loss) per share attributable to Cannae Holdings common shareholders
$
0.07

 
$
(0.24
)
 
$
(0.31
)
Condensed Consolidated Statements of Comprehensive Earnings
 
 
 
 
 
Net earnings (loss)
$
2.0

 
$
(19.9
)
 
$
(21.9
)
Unrealized gain relating to investments in unconsolidated affiliates
6.2

 
5.9

 
(0.3
)
Comprehensive earnings (loss) attributable to Cannae Holdings, Inc.
$
11.7

 
$
(10.5
)
 
$
(22.2
)


Note B — Leases
We are party to operating lease arrangements primarily for leased real estate for restaurants and office space. Right-of-use assets and lease liabilities related to operating leases are recorded at commencement when we are party to a contract which conveys the right for the Company to control an asset for a specified period of time. We are not a party to any material contracts considered finance leases. Right-of-use assets and lease liabilities related to operating leases are recorded as Lease assets and Lease liabilities, respectively, on the Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019.
There have been no changes in our accounting for leases as of or during the three months ended March 31, 2020.

9

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

As a result of the Blue Ribbon Reorganization, we deconsolidated Blue Ribbon as of January 27, 2020. Future payments under operating lease arrangements as of March 31, 2020 are now as follows (in millions):
2020 (remaining)
$
28.8

2021
37.4

2022
29.9

2023
25.9

2024
17.0

Thereafter
88.3

Total lease payments, undiscounted
$
227.3

Less: discount
62.2

Total operating lease liability as of March 31, 2020, at present value
$
165.1

Less: operating lease liability as of March 31, 2020, current
26.7

Operating lease liability as of March 31, 2020, long term
$
138.4



Note C — Fair Value Measurements

The fair value hierarchy established by the accounting standards on fair value measurements includes three levels that are based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Financial assets and liabilities that are recorded in the Condensed Consolidated Balance Sheets are categorized based on the inputs to the valuation techniques as follows:
Level 1.  Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we have the ability to access.
Level 2.  Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability.
Level 3.  Financial assets and liabilities whose values are based on model inputs that are unobservable.
Recurring Fair Value Measurements
The following table presents our fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019, respectively:
 
March 31, 2020
 
Level 1
 
Level 2
 
Level 3
 
Total
 
(In millions)
Fixed-maturity securities available for sale:
 

 
 

 
 

 
 

Corporate debt securities
$

 
$

 
$
26.1

 
$
26.1

Investment in Ceridian
993.4

 

 

 
993.4

     Total
$
993.4

 
$

 
$
26.1

 
$
1,019.5


 
December 31, 2019
 
Level 1
 
Level 2
 
Level 3
 
Total
 
(In millions)
Fixed-maturity securities available for sale:
 

 
 

 
 

 
 

Corporate debt securities
$

 
$

 
$
19.2

 
$
19.2

     Total
$

 
$

 
$
19.2

 
$
19.2



10

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

Our Level 1 fair value measurement for our investment in Ceridian is based on quoted market prices of Ceridian's common equity (NYSE: CDAY).
Our Level 3 fair value measurement for our fixed maturity securities available for sale are provided by a single third-party pricing service. Depending on security specific characteristics, either a combination of an income approach or a contingent claims approach was utilized in determining the fair value of our Level 3 fixed-maturity securities available for sale. Discount rates are the primary unobservable inputs utilized for the securities valued using a combination of an income and net recovery approach. The discount rates used are based on company-specific risk premiums, public company comparable securities, and leveraged loan indices. The discount rates used in our determination of the fair value of our Level 3 fixed-maturity securities available for sale varies by security type and ranged from 14.0% to 14.5% as of March 31, 2020 and a weighted average based on relative fair value of the underlying securities of 14.5%. Based on the total fair value of our Level 3 fixed-maturity securities available for sale as of March 31, 2020, changes in the discount rate utilized will not result in a fair value significantly different or material to the Company's financial position or results of operation than the amount recorded.
The following table presents a summary of the changes in the fair values of Level 3 assets, measured on a recurring basis, for the three months ended March 31, 2020 and 2019 (in millions).
 
Three months ended March 31, 2020
 
Three months ended March 31, 2019
 
Corporate debt
 
Corporate debt
 
securities
 
securities
 
 
 
 
Fair value, beginning of period
$
19.2

 
$
17.8

Impairment (1)

 
(0.3
)
Net valuation gain included in other comprehensive earnings (2)
6.9

 

Fair value, end of period
$
26.1

 
$
17.5


_____________________________________
(1) Included in Realized and other gains and losses, net on the Condensed Consolidated Statements of Operations
(2) Included in Unrealized gain (loss) on investments and other financial instruments, net (excluding investments in unconsolidated affiliates) on the Condensed Consolidated Statements of Comprehensive Earnings (Loss)

Transfers into or out of the Level 3 fair value category occur when unobservable inputs become more or less significant to the fair value measurement or upon a change in valuation technique. There were no transfers between Level 2 and Level 3 in the three months ended March 31, 2020 and 2019.
All of the unrealized gain on investments and other financial instruments, net (excluding investments in unconsolidated affiliates) on our Condensed Consolidated Statements of Comprehensive Earnings (Loss) for the three months ended March 31, 2020 relate to fixed maturity securities considered Level 3 fair value measures.
Additional information regarding the fair value of our investment portfolio is included in Note D.
The carrying amounts of trade receivables and notes receivable approximate fair value due to their short-term nature. The fair value of our notes payable is included in Note F.


11

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

Note D — Investments
Investment in Ceridian
As of March 31, 2020, we account for our investment in Ceridian at fair value pursuant to ASC 321. We recorded unrealized gains of $684.9 million upon the change in accounting all of which relates to Ceridian equity securities which continue to be held by the Company as of March 31, 2020. The unrealized gain is included in Realized and other gains and losses, net on the Condensed Consolidated Statement of Operations for the three months ended March 31, 2020.

Investments in Unconsolidated Affiliates
Investments in unconsolidated affiliates recorded using the equity method of accounting as of March 31, 2020 and December 31, 2019 consisted of the following (in millions):
 
Ownership at March 31, 2020
 
March 31,
2020
 
December 31,
2019
Dun & Bradstreet
24.3
%
 
$
396.5

 
$
385.9

Ceridian (1)
13.7
%
 

 
309.5

Equity Fund
49.0
%
 
134.3

 
46.7

AmeriLife
20.3
%
 
125.0

 

Other
various

 
103.4

 
94.4

Total
 

 
$
759.2

 
$
836.5


_____________________________________
(1) Investment in Ceridian is no longer accounted for under the equity method of accounting as of March 31, 2020.

Equity in earnings (losses) of unconsolidated affiliates for the three months ended March 31, 2020 and March 31, 2019 consisted of the following (in millions):
 
Three months ended March 31, 2020
 
Three months ended March 31, 2019
Dun & Bradstreet
$
10.1

 
$
(24.3
)
Ceridian (1)
1.5

 
2.6

Equity Fund
(58.8
)
 

AmeriLife

 

Other
(5.5
)
 
0.3

Total
$
(52.7
)
 
$
(21.4
)

_____________________________________
(1) Fiscal year 2020 amount represents the Company's equity in earnings of Ceridian in the three months ended March 31, 2020 prior to the change in accounting for the investment as of March 31, 2020.


12

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

Dun & Bradstreet
Summarized financial information for Dun & Bradstreet for the relevant dates and time periods included in Investments in unconsolidated affiliates and Equity in earnings (losses) of unconsolidated affiliates in our Condensed Consolidated Balance Sheets and Statements of Operations, respectively, is presented below.
We acquired our initial interest in Dun & Bradstreet's parent on February 8, 2019. The results of operations for the three months ended March 31, 2019 presented below represents Dun & Bradstreet's results of operations subsequent to our acquisition.
 
March 31,
2020
 
December 31,
2019
 
(In millions)
Total current assets
$
570.1

 
$
417.9

Goodwill and other intangible assets, net
7,994.2

 
8,091.5

Other assets
608.1

 
603.4

Total assets
$
9,172.4

 
$
9,112.8

 
 
 
 
Current liabilities
$
927.7

 
$
1,090.4

Long-term debt
4,023.9

 
3,818.9

Other non-current liabilities
1,568.5

 
1,594.0

Total liabilities
6,520.1

 
6,503.3

Preferred equity
1,032.8

 
1,030.6

Total capital
1,619.5

 
1,578.9

Total liabilities and equity
$
9,172.4

 
$
9,112.8

 
Three months ended March 31, 2020
 
Period from February 8, 2019 to March 31, 2019
 
(In millions)
Total revenues
$
395.3

 
$
174.1

Loss before income taxes
(1.0
)
 
(111.6
)
Net income (loss)
73.9

 
(81.1
)
Dividends attributable to preferred equity and noncontrolling interest expense
(32.4
)
 
(18.3
)
Net income (loss) attributable to Dun & Bradstreet
41.5

 
(99.4
)


Equity Fund
As of March 31, 2020, we have invested $192.1 million in the Equity Fund, all of which has been contributed to the fund's capital and is accounted for under the equity method of accounting for investments. Summarized financial information for the Equity Fund for the relevant dates and time periods included in Investments in unconsolidated affiliates and Equity in losses of unconsolidated affiliates in our Condensed Consolidated Balance Sheets and Statements of Operations, respectively, is presented below.

13

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

 
March 31,
2020
 
December 31,
2019
 
(In millions)
Due from brokers and counterparties
$
393.5

 
$
93.2

Cash and cash equivalents

 
45.2

Derivative contracts, at fair value

 
2.4

Other assets
0.1

 

Total assets
$
393.6

 
$
140.8

 
 
 
 
Derivative contracts, at fair value
$
118.1

 
$

Capital received in advance

 
45.2

Other liabilities
1.4

 
0.2

Total liabilities
119.5

 
45.4

Net assets
$
274.1

 
$
95.4

 
Three months ended March 31, 2020
 
(In millions)
Total net investment loss
$
(0.3
)
Realized gain on securities and derivative contracts
0.5

Change in unrealized loss on derivative contracts
(120.5
)
Change in net assets from operations
(120.3
)


AmerLife
On March 18, 2020, we closed on our $125.0 million investment in the AmeriLife Joint Venture. We account for our investment in AmeriLife as an equity method investment and report our equity in earnings or loss of the AmeriLife Joint Venture on a three-month lag. Because the Company will record its equity in earnings or loss of the AmeriLife Joint Venture using lag reporting, there is no equity in earnings or loss of AmeriLife included in the Company’s results of operations for the three months ended March 31, 2020. The Company plans to begin including its equity earnings or loss related to AmeriLife in the three months ended June 30, 2020, at which time the Company expects to begin providing summary financial information for the AmeriLife Joint Venture.
Equity Security Investments Without Readily Determinable Fair Values
We account for our investment in preferred equity of QOMPLX, Inc. ("QOMPLX"), an intelligent decision and analytics platform used by businesses for modeling and planning, at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly market transactions. As of March 31, 2020, we have $22.5 million recorded for our investment in QOMPLX, which is included in Other long term investments and noncurrent assets on our Condensed Consolidated Balance Sheet. We have not recorded any upward or downward adjustments to our investment in QOMPLX.

14

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

Fixed Maturity Securities
 The carrying amounts and fair values of our available for sale fixed maturity securities at March 31, 2020 and December 31, 2019 are as follows:
 
March 31, 2020
 
Carrying
Value
 
Cost Basis
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair
Value
 
(In millions)
Fixed maturity securities available for sale:
 

 
 

 
 

 
 

 
 

Corporate debt securities
$
26.1

 
$
19.9

 
$
6.4

 
$
(0.2
)
 
$
26.1

  Total
$
26.1

 
$
19.9

 
$
6.4

 
$
(0.2
)
 
$
26.1

 
December 31, 2019
 
Carrying
Value
 
Cost Basis
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair
Value
 
(In millions)
Fixed maturity securities available for sale:
 

 
 

 
 

 
 

 
 

Corporate debt securities
$
19.2

 
$
19.6

 
$
0.7

 
$
(1.1
)
 
$
19.2

  Total
$
19.2

 
$
19.6

 
$
0.7

 
$
(1.1
)
 
$
19.2

 
The cost basis of fixed maturity securities available for sale includes an adjustment for amortized premium or discount and other-than-temporary-impairment recognized in earnings since the date of purchase.
As of March 31, 2020, $25.7 million of the fixed maturity securities in our investment portfolio had a maturity of less than one year and $0.4 million had a maturity of greater than one year, but less than five years. Expected maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties.
During the three months ended March 31, 2020, we incurred no other-than-temporary impairment charges relating to corporate debt securities. During the three months ended March 31, 2019, we incurred $0.3 million of other-than-temporary impairment charges relating to corporate debt securities which is included in Realized and other gains and losses, net on the Condensed Consolidated Statement of Operations. The impairment recorded relates to a corporate debt holding that had experienced a prolonged period of declining earnings and that we were uncertain of our ability to recover our initial investment. All of the loss represents credit loss recognized in earnings and no portion of the loss was included in other comprehensive earnings.
As of March 31, 2020, we held corporate debt securities with a fair value of $7.8 million for which an other-than-temporary impairment had been previously recognized. It is possible that future events may lead us to recognize potential future impairment losses related to our investment portfolio and that unanticipated future events may lead us to dispose of certain investment holdings and recognize the effects of any market movements in our results of operations.

Note E. 
Variable Interest Entities
The Company, in the normal course of business, engages in certain activities that involve variable interest entities ("VIEs"), which are legal entities in which the equity investors as a group lack any of the characteristics of a controlling interest. The primary beneficiary of a VIE is generally the enterprise that has both the power to direct the activities most significant to the economic performance of the VIE and the obligation to absorb losses or receive benefits that could potentially be significant to the VIE. The Company evaluates its interest in certain entities to determine if these entities meet the definition of a VIE and whether the Company is the primary beneficiary and should consolidate the entity based on the variable interests it held both at inception and when there is a change in circumstances that requires a reconsideration. If the Company is determined to be the primary beneficiary of a VIE, it must account for the VIE as a consolidated subsidiary. If the Company is determined not to be the primary beneficiary of a VIE but holds a variable interest in the entity, such variable interests are accounted for under accounting standards as deemed appropriate. As of and for the periods ended March 31, 2020 and December 31, 2019, we are not the primary beneficiary of any VIEs.



15

CANNAE HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) — continued

Unconsolidated VIEs
The table below summarizes select information related to variable interests held by the Company as of March 31, 2020 and December 31, 2019, of which we are not the primary beneficiary:
 
 
March 31, 2020
 
December 31, 2019
 
 
Total Assets
 
Maximum Exposure
 
Total Assets
 
Maximum Exposure
 
(in millions)
Investments in unconsolidated affiliates
 
$
567.2

 
$
578.6