8-K 1 l13257ae8vk.htm BOYKIN LODGING COMPANY 8-K Boykin Lodging Company 8-K
 

 
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 13, 2005

Boykin Lodging Company

(Exact Name of Registrant as Specified in its Charter)
         
Ohio   001-11975   34-1824586
(State or Other Jurisdiction of
Incorporation) 		  (Commission File Number)   (IRS Employer Identification Number)
         
Guildhall Building, Suite 1500, 45 W. Prospect Avenue, Cleveland, Ohio   44115
(Address of Principal Executive Offices)   (Zip Code)

(216) 430-1200
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 

 

 

     
SECTION 2
  FINANCIAL INFORMATION
 
    
ITEM 2.01
  COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS
 
    
  On April 13, 2005, Boykin Lodging Company (the “Company”) sold its French Lick Springs Resort and Spa (“French Lick”) in French Lick, Indiana, for a price of $25.0 million to a subsidiary of the Cook Group Incorporated, an unrelated third party. Net proceeds from the sale of approximately $24.4 million will be available for general corporate purposes.
 
    
SECTION 9
  FINANCIAL STATEMENTS AND EXHIBITS
 
    
ITEM 9.01
  FINANCIAL STATEMENTS AND EXHIBITS
 
    
(a) Financial Statements of Businesses Acquired.
 
    
  None.
 
    
(b) Pro Forma Financial Information.
 
    
  The following unaudited pro forma condensed consolidated financial information for Boykin Lodging Company gives effect to the disposition of French Lick Springs Resort and Spa in French Lick, Indiana, as well as the receipt of proceeds from the sale as described in this Current Report on Form 8-K.
 
    
  The December 31, 2004 unaudited Pro Forma Condensed Consolidated Balance Sheet is presented as if the disposition was effective December 31, 2004. The unaudited Pro Forma Condensed Consolidated Statements of Operations for each of the years in the three year period ended December 31, 2004 assume the sale was effective as of the beginning of the fiscal year ended December 31, 2002.
 
    
  The unaudited pro forma condensed consolidated financial information should be read in conjunction with the consolidated financial statements and related footnotes included in Boykin Lodging Company’s 2004 Annual Report on Form 10-K.

THE FOLLOWING UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL
INFORMATION IS PRESENTED FOR ILLUSTRATIVE PURPOSES ONLY AND IS NOT
NECESSARILY AN INDICATION OF THE FUTURE FINANCIAL POSITION OR RESULTS
OF OPERATIONS OF BOYKIN LODGING COMPANY.

 

 

BOYKIN LODGING COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 2004
(unaudited, dollar amounts in thousands)

                         
            Pro Forma        
            Adjustments        
    (a)     (b)        
    Historical     French Lick     Pro Forma  
Investment in hotel properties
   $ 545,142       (24,976 )   $ 520,166  
Accumulated depreciation
     (134,347 )     9,033       (125,314 )
 
                  
Investment in hotel properties, net
     410,795       (15,943 )     394,852  
Cash and cash equivalents
     34,398       24,387 (c)     58,785  
Restricted cash
     11,272       —       11,272  
Accounts receivable, net of allowance for doubtful accounts of $87
     12,145       (473 )     11,672  
Receivables from lessee
     10       —       10  
Inventories
     1,709       (364 )     1,345  
Deferred financing costs and other, net
     2,014       —       2,014  
Investment in unconsolidated joint ventures
     1,093       —       1,093  
Other assets
     10,091       (984 )     9,107  
 
                  
 
   $ 483,527       6,623     $ 490,150  
 
                  
LIABILITIES AND SHAREHOLDERS’ EQUITY
                        
Borrowings against credit facility
   $ 1,446       —     $ 1,446  
Term notes payable
     193,539       —       193,539  
Accounts payable and accrued expenses
     36,707       (1,158 )     35,549  
Accounts payable to related party
     1,063       8       1,071  
Dividends/distributions payable
     1,188       —       1,188  
Minority interest in joint ventures
     927       —       927  
Minority interest in operating partnership
     11,734       1,166 (d)     12,900  
SHAREHOLDERS’ EQUITY:
                        
Preferred shares, without par value; 10,000,000 shares
authorized; 181,000 shares issued and outstanding as of
December 31, 2004 (liquidation preference of $45,250)
     —       —       —  
Common shares, without par value; 40,000,000 shares
authorized; 17,450,314 outstanding as of December 31, 2004
     —       —       —  
Additional paid-in capital
     358,688       —       358,688  
Distributions and losses in excess of income
     (119,757 )     6,607 (d)     (113,150 )
Unearned compensation – restricted shares
     (2,008 )     —       (2,008 )
 
                  
Total shareholders’ equity
     236,923       6,607       243,530  
 
                  
 
   $ 483,527       6,623     $ 490,150  
 
                  

 

 

BOYKIN LODGING COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2004
(unaudited, amounts in thousands, except for per share data)

                         
            Pro Forma        
            Adjustments        
    (a)     (e)        
    Historical     French Lick     Pro Forma  
Revenues:
                        
Hotel revenues
                        
Rooms
   $ 133,597       (3,891 )   $ 129,706  
Food and beverage
     62,407       (3,456 )     58,951  
Other
     14,414       (3,658 )     10,756  
 
                  
Total hotel revenues
     210,418       (11,005 )     199,413  
Lease revenue
     2,045       —       2,045  
Other operating revenue
     184       —       184  
Revenues from condominium development and unit sales
     7,541       —       7,541  
 
                  
Total revenues
     220,188       (11,005 )     209,183  
 
                  
Expenses:
                        
Hotel operating expenses
                       
Rooms
     33,772       (1,026 )     32,746  
Food and beverage
     43,045       (2,693 )     40,352  
Other direct
     8,181       (2,540 )     5,641  
Indirect
     68,256       (4,195 )     64,061  
Management fees to related party
     5,801       (347 )     5,454  
Management fees — other
     59       —       59  
 
                  
Total hotel operating expenses
     159,114       (10,801 )     148,313  
Property taxes, insurance and other
     15,117       (498 )     14,619  
Cost of condominium development and unit sales
     5,509       —       5,509  
Real estate related depreciation and amortization
     23,980       (1,022 )     22,958  
Corporate general and administrative
     8,801       (14 )     8,787  
 
                  
Total operating expenses
     212,521       (12,335 )     200,186  
 
                  
Operating income
     7,667       1,330       8,997  
Interest income
     387       —       387  
Other income
     8       —       8  
Interest expense
     (13,629 )     —       (13,629 )
Amortization of deferred financing costs
     (1,367 )     —       (1,367 )
Minority interest in earnings of joint ventures
     (141 )     —       (141 )
Minority interest in loss of operating partnership
     1,763       (200 )     1,563  
Equity in income of unconsolidated joint ventures
     121       —       121  
 
                  
 
                        
Loss from continuing operations
     (5,191 )     1,130       (4,061 )
 
                        
Loss from continuing operations per share:
                        
Basic
   $ (0.30 )           $ (0.23 )
Diluted
   $ (0.30 )           $ (0.23 )
 
                        
Weighted average number of common shares outstanding:
                        
Basic
     17,426               17,426  
Diluted
     17,553               17,553  

 

 

BOYKIN LODGING COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2003
(unaudited, amounts in thousands, except for per share data)

                         
            Pro Forma        
            Adjustments        
    (a)     (e)        
    Historical     French Lick     Pro Forma  
Revenues:
                        
Hotel revenues Rooms
   $ 122,821       (4,050 )   $ 118,771  
Food and beverage
     58,268       (3,477 )     54,791  
Other
     11,314       (3,967 )     7,347  
 
                  
Total hotel revenues
     192,403       (11,494 )     180,909  
Lease revenue
     1,958       —       1,958  
Other operating revenue
     120       —       120  
Revenues from condominium development and unit sales
     36,883       —       36,883  
 
                  
Total revenues
     231,364       (11,494 )     219,870  
 
                  
Expenses:
                        
Hotel operating expenses Rooms
     30,850       (1,081 )     29,769  
Food and beverage
     40,877       (2,868 )     38,009  
Other direct
     7,142       (2,629 )     4,513  
Indirect
     61,672       (3,907 )     57,765  
Management fees to related party
     4,339       (363 )     3,976  
Management fees – other
     882       —       882  
 
                  
Total hotel operating expenses
     145,762       (10,848 )     134,914  
Property taxes, insurance and other
     14,530       (745 )     13,785  
Cost of condominium development and unit sales
     24,645       —       24,645  
Real estate related depreciation and amortization
     26,048       (1,275 )     24,773  
Corporate general and administrative
     8,138       (29 )     8,109  
 
                  
Total operating expenses
     219,123       (12,897 )     206,226  
 
                  
Operating income
     12,241       1,403       13,644  
Interest income
     602       —       602  
Other income
     39       (11 )     28  
Interest expense
     (14,923 )     —       (14,923 )
Amortization of deferred financing costs
     (1,906 )     —       (1,906 )
Minority interest in loss of joint ventures
     (133 )     —       (133 )
Minority interest in loss of operating partnership
     1,858       (209 )     1,649  
Equity in loss of unconsolidated joint ventures
     (133 )     —       (133 )
 
                  
 
                        
Loss from continuing operations
     (2,355 )     1,183       (1,172 )
 
                  
 
                        
Loss from continuing operations per share:
                        
Basic
   $ (0.14 )           $ (0.07 )
Diluted
   $ (0.14 )           $ (0.07 )
 
                        
Weighted average number of common shares outstanding:
                        
Basic
     17,336               17,336  
Diluted
     17,470               17,470  

 

 

BOYKIN LODGING COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2002
(unaudited, amounts in thousands, except for per share data)

                         
            Pro Forma        
            Adjustments        
    (a)     (e)        
    Historical     French Lick     Pro Forma  
Revenues:
                        
Hotel revenues:
                        
Rooms
   $ 129,341       (4,845 )   $ 124,496  
Food and beverage
     61,728       (3,924 )     57,804  
Other
     11,632       (4,030 )     7,602  
 
                  
Total hotel revenues
     202,701       (12,799 )     189,902  
Lease revenue
     1,885       —       1,885  
Other operating revenue
     279       —       279  
Revenues from condominium development and unit sales
     8,715       —       8,715  
 
                  
Total revenues
     213,580       (12,799 )     200,781  
Expenses:
                        
Hotel operating expenses:
                        
Rooms
     31,432       (1,223 )     30,209  
Food and beverage
     42,984       (3,186 )     39,798  
Other direct
     7,342       (2,800 )     4,542  
Indirect
     57,912       (4,280 )     53,632  
Management fees to related party
     3,741       (382 )     3,359  
Management fees – other
     2,261       —       2,261  
 
                  
Total hotel operating expenses
     145,672       (11,871 )     133,801  
Property taxes, insurance and other
     12,921       (468 )     12,453  
Cost of condominium development and unit sales
     6,474       —       6,474  
Real estate related depreciation and amortization
     23,340       (1,302 )     22,038  
Corporate general and administrative
     6,404       —       6,404  
 
                  
Total operating expenses
     194,811       (13,641 )     181,170  
 
                  
Operating income
     18,769       842       19,611  
Interest income
     126       —       126  
Other income
     80       —       80  
Interest expense
     (18,068 )     —       (18,068 )
Amortization of deferred financing costs
     (2,105 )     —       (2,105 )
Minority interest in earnings of joint ventures
     (133 )     —       (133 )
Minority interest in loss of operating partnership
     726       (128 )     598  
Equity in loss of unconsolidated joint ventures
     (224 )     —       (224 )
 
                  
 
                        
Loss from continuing operations
     (829 )     714       (115 )
 
                        
Loss from continuing operations per share:
                        
Basic
   $ (0.05 )           $ (0.01 )
Diluted
   $ (0.05 )           $ (0.01 )
 
                        
Weighted average number of common shares outstanding:
                        
Basic
     17,248               17,248  
Diluted
     17,383               17,383  

 

 

(a)   Historical data presented reflects amounts reported on Form 8-K filed on April 1, 2005.
 
(b)   Represents the necessary adjustments to Boykin’s historical financial statements to remove the assets and liabilities associated with French Lick, as applicable, as well as to reflect the receipt of the sales proceeds.
 
(c)   The net proceeds from the sale were approximately $24.4 million and are available for general corporate purposes.
 
(d)   Reflects the estimated impact of the sale on minority interest and shareholders’ equity as if the sale took place on December 31, 2004. The actual impact of the transactions was based upon the carrying value of the assets at the time of the sale.
 
(e)   Reflects the adjustment to Boykin’s historical financial statements to present them as if the disposition of French Lick had occurred on January 1, 2002. The gain or loss on the sale is not reflected in the pro forma condensed consolidated statements of operations. Boykin anticipates that the actual gain on the sale, net of minority interest, will approximate $6.3 million.

 

 

     (c)     Exhibits.

     None

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

BOYKIN LODGING COMPANY
         
     
By:   /s/ Shereen P. Jones      
  --------------------------------------------------     
    Shereen P. Jones
Executive Vice President, Chief Financial and
Investment Officer 		  
 

Date: April 14, 2005