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SECURITIES AND EXCHANGE COMMISSION
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 16-1736884 | |
(State or other jurisdiction of | (I.R.S. employer | |
incorporation or organization) | identification no.) | |
475 Tenth Avenue | ||
New York, New York | 10018 | |
(Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code)
Large accelerated filero | Accelerated filerþ | Non-accelerated filero | Smaller reporting companyo | |||
(Do not check if a smaller reporting company) |
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Exhibit 10.1 | ||||||||
Exhibit 10.4 | ||||||||
Exhibit 10.5 | ||||||||
Exhibit 10.6 | ||||||||
Exhbiti 10.7 | ||||||||
Exhibit 10.8 | ||||||||
Exhibit 10.9 | ||||||||
Exhibit 10.10 | ||||||||
Exhibit 10.11 | ||||||||
Exhibit 10.12 | ||||||||
Exhibit 31.1 | ||||||||
Exhibit 31.2 | ||||||||
Exhibit 32.1 | ||||||||
Exhibit 32.2 |
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(in thousands, except per share data)
September 30, | December 31, | |||||||
2010 | 2009 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Property and equipment, net | $ | 475,143 | $ | 488,189 | ||||
Goodwill | 73,698 | 73,698 | ||||||
Investments in and advances to unconsolidated joint ventures | 25,185 | 32,445 | ||||||
Investment in hotel property of discontinued operations, net | — | 23,977 | ||||||
Cash and cash equivalents | 29,949 | 68,994 | ||||||
Restricted cash | 39,111 | 21,109 | ||||||
Accounts receivable, net | 8,664 | 6,531 | ||||||
Related party receivables | 4,312 | 9,522 | ||||||
Prepaid expenses and other assets | 8,762 | 10,862 | ||||||
Deferred tax asset, net | 81,137 | 83,980 | ||||||
Other, net | 13,139 | 18,931 | ||||||
Total assets | $ | 759,100 | $ | 838,238 | ||||
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | ||||||||
Debt and capital lease obligations | $ | 702,435 | $ | 699,013 | ||||
Mortgage debt of discontinued operations | — | 40,000 | ||||||
Accounts payable and accrued liabilities | 30,727 | 30,325 | ||||||
Accounts payable and accrued liabilities of discontinued operations | 8 | 1,455 | ||||||
Distributions and losses in excess of investment in unconsolidated joint ventures | 2,855 | 2,740 | ||||||
Other liabilities | 65,196 | 41,294 | ||||||
Total liabilities | 801,221 | 814,827 | ||||||
Commitments and contingencies | ||||||||
Preferred securities, $.01 par value; liquidation preference $1,000 per share, 75,000 shares authorized and issued at September 30, 2010 and December 31, 2009, respectively | 50,420 | 48,564 | ||||||
Common stock, $.01 par value; 200,000,000 shares authorized; 36,277,495 shares issued at September 30, 2010 and December 31, 2009, respectively | 363 | 363 | ||||||
Additional paid-in capital | 249,504 | 247,728 | ||||||
Treasury stock, at cost, 6,039,602 and 6,594,864 shares of common stock at September 30, 2010 and December 31, 2009, respectively | (93,625 | ) | (99,724 | ) | ||||
Accumulated comprehensive loss | (2,111 | ) | (6,000 | ) | ||||
Accumulated deficit | (257,878 | ) | (181,911 | ) | ||||
Total Morgans Hotel Group Co. stockholders’ (deficit) equity | (53,327 | ) | 9,020 | |||||
Noncontrolling interest | 11,206 | 14,391 | ||||||
Total (deficit) equity | (42,121 | ) | 23,411 | |||||
Total liabilities and stockholders’ (deficit) equity | $ | 759,100 | $ | 838,238 | ||||
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(in thousands, except per share data)
(unaudited)
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended Sept. 30, | Ended Sept. 30, | Ended Sept. 30, | Ended Sept. 30, | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Revenues: | ||||||||||||||||
Rooms | $ | 35,100 | $ | 32,026 | $ | 99,443 | $ | 89,033 | ||||||||
Food and beverage | 16,017 | 18,116 | 51,062 | 55,075 | ||||||||||||
Other hotel | 2,077 | 2,284 | 6,730 | 6,788 | ||||||||||||
Total hotel revenues | 53,194 | 52,426 | 157,235 | 150,896 | ||||||||||||
Management fee-related parties and other income | 4,547 | 3,998 | 14,079 | 11,311 | ||||||||||||
Total revenues | 57,741 | 56,424 | 171,314 | 162,207 | ||||||||||||
Operating Costs and Expenses: | ||||||||||||||||
Rooms | 11,061 | 10,423 | 31,377 | 30,051 | ||||||||||||
Food and beverage | 14,426 | 14,163 | 42,526 | 41,856 | ||||||||||||
Other departmental | 1,322 | 1,485 | 3,834 | 4,449 | ||||||||||||
Hotel selling, general and administrative | 12,275 | 11,969 | 35,523 | 34,154 | ||||||||||||
Property taxes, insurance and other | 3,650 | 4,569 | 12,461 | 12,862 | ||||||||||||
Total hotel operating expenses | 42,734 | 42,609 | 125,721 | 123,372 | ||||||||||||
Corporate expenses, including stock compensation of $2.3 million, $3.2 million, $8.9 million, and $8.8 million, respectively | 8,045 | 8,507 | 27,270 | 25,295 | ||||||||||||
Depreciation and amortization | 8,173 | 7,234 | 23,529 | 22,279 | ||||||||||||
Restructuring, development and disposal costs | 1,064 | 489 | 2,930 | 2,020 | ||||||||||||
Impairment loss on receivables from unconsolidated joint venture | 5,499 | — | 5,499 | — | ||||||||||||
Total operating costs and expenses | 65,515 | 58,839 | 184,949 | 172,966 | ||||||||||||
Operating loss | (7,774 | ) | (2,415 | ) | (13,635 | ) | (10,759 | ) | ||||||||
Interest expense, net | 8,610 | 12,842 | 33,907 | 35,791 | ||||||||||||
Equity in loss of unconsolidated joint ventures | 1,435 | 19,482 | 9,437 | 21,920 | ||||||||||||
Impairment loss on development project | — | 11,914 | — | 11,914 | ||||||||||||
Other non-operating expenses | 20,471 | 869 | 35,789 | 1,934 | ||||||||||||
Loss before income taxes | (38,290 | ) | (47,522 | ) | (92,768 | ) | (82,318 | ) | ||||||||
Income tax expense (benefit) | 236 | (19,494 | ) | 535 | (34,619 | ) | ||||||||||
Net loss before loss attributable to noncontrolling interest | (38,526 | ) | (28,028 | ) | (93,303 | ) | (47,699 | ) | ||||||||
Net loss attributable to noncontrolling interest | 1,452 | 817 | 2,033 | 399 | ||||||||||||
Net loss from continuing operations | (37,074 | ) | (27,211 | ) | (91,270 | ) | (47,300 | ) | ||||||||
(Loss) income from discontinued operations | (3 | ) | (606 | ) | 17,162 | (1,158 | ) | |||||||||
Net loss | (37,077 | ) | (27,817 | ) | (74,108 | ) | (48,458 | ) | ||||||||
Preferred stock dividends and accretion | 2,164 | — | 6,357 | — | ||||||||||||
Net loss attributable to common stockholders | (39,241 | ) | (27,817 | ) | (80,465 | ) | (48,458 | ) | ||||||||
Other comprehensive loss: | ||||||||||||||||
Unrealized gain on valuation of swap/cap agreements, net of tax | 1,055 | 3,887 | 11,058 | 12,303 | ||||||||||||
Share of unrealized loss on valuation of swap agreements from unconsolidated joint venture, net of tax | (1,274 | ) | — | (1,274 | ) | — | ||||||||||
Realized loss on settlement of swap/cap agreements, net of tax | (830 | ) | (2,382 | ) | (5,971 | ) | (7,379 | ) | ||||||||
Foreign currency translation gain (loss) | (179 | ) | 532 | 77 | (512 | ) | ||||||||||
Comprehensive loss | $ | (40,469 | ) | $ | (25,780 | ) | $ | (76,575 | ) | $ | (44,046 | ) | ||||
(Loss) Income per share: | ||||||||||||||||
Basic and diluted continuing operations | $ | (1.30 | ) | $ | (0.92 | ) | $ | (3.20 | ) | $ | (1.58 | ) | ||||
Basic and diluted discontinued operations | $ | (0.00 | ) | $ | (0.02 | ) | $ | 0.56 | $ | (0.04 | ) | |||||
Basic and diluted attributable to common stockholders | $ | (1.30 | ) | $ | (0.94 | ) | $ | (2.64 | ) | $ | (1.62 | ) | ||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic and diluted | 30,162 | 29,737 | 30,470 | 29,941 |
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(in thousands)
(unaudited)
Nine Months Ended Sept. 30, | ||||||||
2010 | 2009 | |||||||
Cash flows from operating activities: | ||||||||
Net loss, before noncontrolling interest and after discontinued operations | $ | (76,141 | ) | $ | (48,857 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation | 21,992 | 21,762 | ||||||
Amortization of other costs | 1,537 | 517 | ||||||
Amortization of deferred financing costs | 4,349 | 2,615 | ||||||
Amortization of discount on convertible notes | 1,708 | 1,707 | ||||||
Stock-based compensation | 8,892 | 8,805 | ||||||
Accretion of interest on capital lease obligation | 3,317 | 1,222 | ||||||
Equity in losses from unconsolidated joint ventures | 9,437 | 21,920 | ||||||
Impairment loss on development project | — | 11,893 | ||||||
Impairment loss on receivables from unconsolidated joint ventures | 5,499 | — | ||||||
Gain on disposal of assets | (17,766 | ) | — | |||||
Deferred income taxes | — | (36,300 | ) | |||||
Change in value of warrants | 32,902 | — | ||||||
Change in value of interest rate caps, net | 26 | — | ||||||
Changes in assets and liabilities: | ||||||||
Accounts receivable, net | (2,133 | ) | 32 | |||||
Related party receivables | (289 | ) | (5,271 | ) | ||||
Restricted cash | (18,718 | ) | 1,823 | |||||
Prepaid expenses and other assets | 2,100 | (1,384 | ) | |||||
Accounts payable and accrued liabilities | 267 | 3,866 | ||||||
Other liabilities | (150 | ) | (56 | ) | ||||
Discontinued operations | 350 | 1,950 | ||||||
Net cash used in operating activities | (22,821 | ) | (13,756 | ) | ||||
Cash flows from investing activities: | ||||||||
Additions to property and equipment | (10,602 | ) | (8,510 | ) | ||||
Deposits to capital improvement escrows, net | 716 | 625 | ||||||
Distributions from unconsolidated joint ventures | 206 | 6 | ||||||
Investment in unconsolidated joint ventures | (4,340 | ) | (8,232 | ) | ||||
Net cash used in investing activities | (14,020 | ) | (16,111 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from debt | — | 139,789 | ||||||
Payments on debt and capital lease obligations | — | (115,781 | ) | |||||
Payments for deferred financing costs | (167 | ) | (7,063 | ) | ||||
Cash paid in connection with vesting of stock based awards | (772 | ) | (135 | ) | ||||
Distributions to holders of noncontrolling interests in consolidated subsidiaries | (1,019 | ) | (1,572 | ) | ||||
Issuance costs of preferred stock and warrants | (246 | ) | — | |||||
Net cash (used in) provided by financing activities | (2,204 | ) | 15,238 | |||||
Net decrease in cash and cash equivalents | (39,045 | ) | (14,629 | ) | ||||
Cash and cash equivalents, beginning of period | 68,994 | 48,656 | ||||||
Cash and cash equivalents, end of period | $ | 29,949 | $ | 34,027 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid for interest, net of interest capitalized | $ | 27,703 | $ | 30,859 | ||||
Cash paid for taxes | $ | 19 | $ | 411 | ||||
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(unaudited)
Number of | ||||||||||
Hotel Name | Location | Rooms | Ownership | |||||||
Delano South Beach | Miami Beach, FL | 194 | (1 | ) | ||||||
Hudson | New York, NY | 831 | (5 | ) | ||||||
Mondrian Los Angeles | Los Angeles, CA | 237 | (1 | ) | ||||||
Morgans | New York, NY | 114 | (1 | ) | ||||||
Royalton | New York, NY | 168 | (1 | ) | ||||||
Sanderson | London, England | 150 | (2 | ) | ||||||
St Martins Lane | London, England | 204 | (2 | ) | ||||||
Shore Club | Miami Beach, FL | 309 | (3 | ) | ||||||
Clift | San Francisco, CA | 372 | (4 | ) | ||||||
Hard Rock Hotel & Casino | Las Vegas, NV | 1,510 | (6 | ) | ||||||
Mondrian South Beach | Miami Beach, FL | 328 | (2 | ) | ||||||
Ames | Boston, MA | 114 | (7 | ) | ||||||
Water and Beach Club Hotel | San Juan, PR | 78 | (8 | ) | ||||||
Hotel Las Palapas | Playa del Carmen, Mexico | 75 | (9 | ) |
(1) | Wholly-owned hotel. | |
(2) | Owned through a 50/50 unconsolidated joint venture. See note 4. |
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(3) | Operated under a management contract, with an unconsolidated minority ownership interest of approximately 7%. | |
(4) | The hotel is operated under a long-term lease, which is accounted for as a financing. See note 6. | |
(5) | The Company owns 100% of Hudson, which is part of a property that is structured as a condominium, in which Hudson constitutes 96% of the square footage of the entire building. | |
(6) | Operated under a management contract and owned through an unconsolidated joint venture, of which the Company calculated an approximately 12.8% ownership interest at September 30, 2010 based on weighted cash contributions. See note 4. | |
(7) | Operated under a management contract and owned through an unconsolidated joint venture, of which the Company owned approximately 31%, at September 30, 2010 based on cash contributions. See note 4. | |
(8) | Operated under a management contract, with an unconsolidated minority ownership interest of approximately 25% at September 30, 2010 based on cash contributions. See note 4. | |
(9) | Operated under a management contract. |
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Estimated | ||||||||||||
Fair Market | ||||||||||||
Value at | ||||||||||||
Type of | Maturity | Strike | December 31, | |||||||||
Notional Amount | Instrument | Date | Rate | 2009 | ||||||||
$285,000 | Interest swap | July 9, 2010 | 5.04 | % | $ | (6,925 | ) | |||||
$85,000 | Interest swap | July 15, 2010 | 4.91 | % | (2,075 | ) | ||||||
Fair value of derivative instruments designated as effective hedges | (9,000 | ) | ||||||||||
Total fair value of derivative instruments | $ | (9,000 | ) | |||||||||
Total fair value included in other assets | $ | — | ||||||||||
Total fair value included in other liabilities | $ | (9,000 | ) | |||||||||
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Three Months | Three Months | |||||||
Ended | Ended | |||||||
Sept. 30, 2010 | Sept. 30, 2009 | |||||||
Numerator: | ||||||||
Net loss from continuing operations | $ | (37,074 | ) | $ | (27,211 | ) | ||
Net loss from discontinued operations | (3 | ) | (606 | ) | ||||
Net loss attributable to common shareholders | (37,077 | ) | (27,817 | ) | ||||
Less: preferred stock dividends and accretion | 2,164 | — | ||||||
Numerator for basic and diluted loss available to common stockholders | $ | (39,241 | ) | $ | (27,817 | ) | ||
Denominator, continuing and discontinued operations: | ||||||||
Weighted average basic common shares outstanding | 30,162 | 29,737 | ||||||
Effect of dilutive securities | — | — | ||||||
Weighted average diluted common shares outstanding | 30,162 | 29,737 | ||||||
Basic and diluted loss from continuing operations per share | $ | (1.30 | ) | $ | (0.92 | ) | ||
Basic and diluted loss from discontinued operations per share | $ | (0.00 | ) | $ | (0.02 | ) | ||
Basic and diluted loss available to common stockholders per common share | $ | (1.30 | ) | $ | (0.94 | ) | ||
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Nine Months | Nine Months | |||||||
Ended | Ended | |||||||
Sept. 30, 2010 | Sept. 30, 2009 | |||||||
Numerator: | ||||||||
Net loss from continuing operations | $ | (91,270 | ) | $ | (47,300 | ) | ||
Net income (loss) from discontinued operations | 17,162 | (1,158 | ) | |||||
Net loss attributable to common shareholders | (74,108 | ) | (48,458 | ) | ||||
Less: preferred stock dividends and accretion | 6,357 | — | ||||||
Numerator for basic and diluted loss available to common stockholders | $ | (80,465 | ) | $ | (48,458 | ) | ||
Denominator, continuing and discontinued operations: | ||||||||
Weighted average basic common shares outstanding | 30,470 | 29,941 | ||||||
Effect of dilutive securities | — | — | ||||||
Weighted average diluted common shares outstanding | 30,470 | 29,941 | ||||||
Basic and diluted loss from continuing operations per share | $ | (3.20 | ) | $ | (1.58 | ) | ||
Basic and diluted income (loss) from discontinued operations per share | $ | 0.56 | $ | (0.04 | ) | |||
Basic and diluted loss available to common stockholders per common share | $ | (2.64 | ) | $ | (1.62 | ) | ||
As of | As of | |||||||
September 30, | December 31, | |||||||
Entity | 2010 | 2009 | ||||||
Mondrian South Beach | $ | 11,612 | $ | 10,745 | ||||
Mondrian SoHo | — | 8,335 | ||||||
Boston Ames | 10,607 | 11,185 | ||||||
Other | 2,966 | 2,180 | ||||||
Total investments in and advances to unconsolidated joint ventures | $ | 25,185 | $ | 32,445 | ||||
As of | As of | |||||||
September 30, | December 31, | |||||||
Entity | 2010 | 2009 | ||||||
Morgans Hotel Group Europe Ltd. | $ | (1,134 | ) | $ | (1,604 | ) | ||
Restaurant Venture — SC London | (1,721 | ) | (1,136 | ) | ||||
Hard Rock Hotel & Casino | — | — | ||||||
Total losses from and distributions in excess of investment in unconsolidated joint ventures | $ | (2,855 | ) | $ | (2,740 | ) | ||
Three Months Ended | Three Months Ended | Nine Months Ended | Nine Months Ended | |||||||||||||
Entity | September 30, 2010 | September 30, 2009 | September 30, 2010 | September 30, 2009 | ||||||||||||
Morgans Hotel Group Europe Ltd. | $ | 1,041 | $ | 625 | $ | 2,540 | $ | 798 | ||||||||
Restaurant Venture — SC London | (136 | ) | (230 | ) | (584 | ) | (647 | ) | ||||||||
Mondrian South Beach | (1,576 | ) | (2,580 | ) | (1,808 | ) | (4,667 | ) | ||||||||
Ames | (86 | ) | — | (577 | ) | — | ||||||||||
Echelon Las Vegas | — | (17,300 | ) | — | (17,411 | ) | ||||||||||
Mondrian SoHo | (680 | ) | — | (9,015 | ) | — | ||||||||||
Other | 2 | 3 | 7 | 7 | ||||||||||||
Total equity in loss from unconsolidated joint ventures | $ | (1,435 | ) | $ | (19,482 | ) | $ | (9,437 | ) | $ | (21,920 | ) | ||||
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As of | As of | |||||||
September 30, | December 31, | |||||||
2010 | 2009 | |||||||
Interest swap liability (note 2) | $ | — | $ | 9,000 | ||||
Design contract claims | 13,866 | 13,866 | ||||||
Warrant liability (note 8) | 51,330 | 18,428 | ||||||
$ | 65,196 | $ | 41,294 | |||||
As of | As of | Interest rate at | ||||||||||
September 30, | December 31, | September 30, | ||||||||||
Description | 2010 | 2009 | 2010 | |||||||||
Notes secured by Hudson and Mondrian (a) | $ | 364,000 | $ | 364,000 | LIBOR + 1.25% | |||||||
Clift debt (b) | 84,920 | 83,206 | 9.60 | % | ||||||||
Promissory notes (c) | 10,500 | 10,500 | 11.00 | % | ||||||||
Liability to subsidiary trust (d) | 50,100 | 50,100 | 8.68 | % | ||||||||
Revolving credit (e) | 23,508 | 23,508 | (e | ) | ||||||||
Convertible Notes, face value of $172.5 million (f) | 163,299 | 161,591 | 2.38 | % | ||||||||
Capital lease obligations | 6,108 | 6,108 | Varies | |||||||||
Total debt | $ | 702,435 | $ | 699,013 | ||||||||
Note secured by discontinued operation (g) | — | 40,000 | ||||||||||
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• | deleted the financial covenant requiring the Company to maintain certain leverage ratios; |
• | revised the fixed charge coverage ratio (defined generally as the ratio of consolidated EBITDA excluding Mondrian Scottsdale’s EBITDA for the periods ending June 30, 2009 and September 30, 2009 and Clift’s EBITDA for all periods to consolidated interest expense excluding Mondrian Scottsdale’s interest expense for the periods ending June 30, 2009 and September 30, 2009 and Clift’s interest expense for all periods) that the Company is required to maintain for each four-quarter period to no less than 0.90 to 1.00 from the previous fixed charge coverage ratio of no less than 1.75 to 1.00. As of September 30, 2010, the Company’s fixed charge coverage ratio under the Amended Revolving Credit Facility was 1.35x; |
• | limits defaults relating to bankruptcy and judgments to certain events involving the Company, Morgans Group and subsidiaries that are parties to the Amended Revolving Credit Facility; |
• | prohibits capital expenditures with respect to any hotels owned by the Company, the borrowers, as defined, or subsidiaries, other than maintenance capital expenditures for any hotel not exceeding 4% of the annual gross revenues of such hotel and certain other exceptions; |
• | revised certain provisions related to permitted indebtedness, including, among other things, deleting certain provisions permitting unsecured indebtedness and indebtedness for the acquisition or expansion of hotels; |
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• | prohibits repurchases of the Company’s common equity interests by the Company or Morgans Group; |
• | imposes certain limits on any secured swap agreements entered into after the effective date of the Amended Revolving Credit Facility; and |
• | provided for a waiver of any default or event of default, to the extent that a default or event of default existed for failure to comply with any financial covenant as of June 30, 2009 and/or for the four fiscal quarters ended June 30, 2009 under the Revolving Credit Facility before it was amended. |
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Restricted Stock | ||||||||||||
Units | LTIP Units | Stock Options | ||||||||||
Outstanding as of January 1, 2010 | 1,265,332 | 2,018,659 | 1,659,279 | |||||||||
Granted during 2010 | 256,235 | 453,619 | — | |||||||||
Distributed/exercised during 2010 | (475,505 | ) | (193,139 | ) | — | |||||||
Forfeited during 2010 | (132,622 | ) | (7,702 | ) | (144,407 | ) | ||||||
Outstanding as of September 30, 2010 | 913,440 | 2,271,437 | 1,514,872 | |||||||||
Vested as of September 30, 2010 | 216,025 | 1,343,894 | 1,267,108 | |||||||||
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• | the sale of substantially all of the Company’s assets to a third party; |
• | the acquisition by the Company of a third party where the equity investment by the Company is $100 million or greater; |
• | the acquisition of the Company by a third party; or |
• | any change in the size of the Company’s Board of Directors to a number below 7 or above 9. |
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Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
Sept. 30, 2010 | Sept. 30, 2009 | Sept. 30, 2010 | Sept. 30, 2009 | |||||||||||||
Operating revenues | $ | — | $ | 1,243 | $ | 1,594 | $ | 6,127 | ||||||||
Operating expenses | (3 | ) | (1,997 | ) | (1,807 | ) | (6,679 | ) | ||||||||
Interest expense | — | (257 | ) | (177 | ) | (808 | ) | |||||||||
Depreciation and amortization expense | — | (293 | ) | (268 | ) | (879 | ) | |||||||||
Income tax benefit | — | 698 | — | 1,081 | ||||||||||||
Gain on disposal | — | — | 17,820 | — | ||||||||||||
(Loss) income from discontinued operations | $ | (3 | ) | $ | (606 | ) | $ | 17,162 | $ | (1,158 | ) | |||||
Non-recourse Carve-out Guarantees
On December 24, 2009, Morgans Group, together with DLJMB, as guarantors, entered into an amendment of the non-recourse carve-out guaranty, dated August 1, 2008, related to the non-recourse loan, secured by approximately 11-acres of unused land owned by a Hard Rock subsidiary, increasing the amount of such guaranty to $53.9 million, which guaranty is only triggered in the event of certain “bad boy” acts. In the Company’s joint venture agreement, DLJMB has agreed to be responsible for 100% of any liability under the guaranty subject to certain conditions. In addition, Morgans Group, together with DLJMB, as guarantors, provided a non-recourse, carve-out guaranty in connection with the Hard Rock Credit Facility, which is only triggered in the event of bankruptcy filings and other standard non-recourse carve-outs. The Company’s Chairman of the Board, is also Chairman of the Board, President, Chief Executive Officer and equity holder of NorthStar Realty Finance Corp., which is a participant lender in the Hard Rock Credit Facility and the land loan.
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• | our Owned Hotels, consisting of Morgans, Royalton and Hudson in New York, Delano South Beach in Miami, Mondrian Los Angeles in Los Angeles, and Clift in San Francisco; |
• | our Joint Venture Hotels, consisting of our London hotels (Sanderson and St Martins Lane), Hard Rock in Las Vegas, Mondrian South Beach and Shore Club in South Beach, Miami, Ames in Boston, and the San Juan Water and Beach Club in Isla Verde, Puerto Rico; |
• | our investments in hotels under construction, such as Mondrian SoHo, and our investment in other proposed properties; |
• | our investment in certain joint venture food and beverage operations at our Owned Hotels and Joint Venture Hotels, discussed further below; |
• | our management company subsidiary, Morgans Hotel Group Management LLC, or MHG Management Company, and certain non-U.S. management company affiliates; and |
• | the rights and obligations contributed to Morgans Group LLC, or Morgans Group, the Company’s operating company, in the formation and structuring transactions described in note 1 to the consolidated financial statements, included elsewhere in this report. |
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• | Sanderson —June 2018 (with one 10-year extension at our option); | ||
• | St Martins Lane —June 2018 (with one 10-year extension at our option); | ||
• | Shore Club —July 2022; | ||
• | Hard Rock —February 2027 (with two 10-year extensions); | ||
• | Mondrian South Beach —August 2026; | ||
• | Ames —November 2024; and | ||
• | San Juan Water and Beach Club —October 2019 (subject to certain conditions). |
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• | Occupancy; |
• | Average daily room rate (“ADR”); and |
• | Revenue per available rooms (“RevPAR”), which is the product of ADR and average daily occupancy; but does not include food and beverage revenue, other hotel operating revenue such as telephone, parking and other guest services, or management fee revenue. |
• | Rooms revenue.Occupancy and ADR are the major drivers of rooms revenue. |
• | Food and beverage revenue.Most of our food and beverage revenue is earned by our 50/50 restaurant joint ventures and is driven by occupancy of our hotels and the popularity of our bars and restaurants with our local customers. |
• | Other hotel revenue.Other hotel revenue, which consists of ancillary revenue such as telephone, parking, spa, entertainment and other guest services, is principally driven by hotel occupancy. |
• | Management fee — related parties revenue and other income.We earn fees under our management agreements. These fees may include management fees as well as reimbursement for allocated chain services. |
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• | Rooms expense.Rooms expense includes the payroll and benefits for the front office, housekeeping, concierge and reservations departments and related expenses, such as laundry, rooms supplies, travel agent commissions and reservation expense. Like rooms revenue, occupancy is a major driver of rooms expense, which has a significant correlation with rooms revenue. |
• | Food and beverage expense.Similar to food and beverage revenue, occupancy of our hotels and the popularity of our restaurants and bars are the major drivers of food and beverage expense, which has a significant correlation with food and beverage revenue. |
• | Other departmental expense.Occupancy is the major driver of other departmental expense, which includes telephone and other expenses related to the generation of other hotel revenue. |
• | Hotel selling, general and administrative expense.Hotel selling, general and administrative expense consist of administrative and general expenses, such as payroll and related costs, travel expenses and office rent, advertising and promotion expenses, comprising the payroll of the hotel sales teams, the global sales team and advertising, marketing and promotion expenses for our hotel properties, utility expense and repairs and maintenance expenses, comprising the ongoing costs to repair and maintain our hotel properties. |
• | Property taxes, insurance and other.Property taxes, insurance and other consist primarily of insurance costs and property taxes. |
• | Corporate expenses, including stock compensation.Corporate expenses consist of the cost of our corporate office, net of any cost recoveries, which consists primarily of payroll and related costs, stock-based compensation expenses, office rent and legal and professional fees and costs associated with being a public company. |
• | Depreciation and amortization expense.Hotel properties are depreciated using the straight-line method over estimated useful lives of 39.5 years for buildings and five years for furniture, fixtures and equipment. |
• | Restructuring, development and disposal costsinclude costs incurred related to our restructuring initiatives, charges associated with disposals of assets as part of major renovation projects and the write-off of abandoned development projects resulting primarily from events generally outside management’s control such as the current tightness of the credit markets. These items do not relate to the ongoing operating performance of our assets. |
• | Impairment loss on receivables from unconsolidated joint venturesincludes impairment costs incurred related to receivables deemed uncollectible. |
• | Interest expense, net.Interest expense, net includes interest on our debt and amortization of financing costs and is presented net of interest income and interest capitalized. |
• | Equity in (income) loss of unconsolidated joint ventures. Equity in (income) loss of unconsolidated joint ventures constitutes our share of the net profits and losses of our Joint Venture Hotels and our investments in hotels under development. Further, we and our joint venture partners review our Joint Venture Hotels for other-than-temporary declines in market value. In this analysis of fair value, we use discounted cash flow analysis to estimate the fair value of our investment taking into account expected cash flow from operations, holding period and net proceeds from the dispositions of the property. Any decline that is not expected to be recovered is considered other-than-temporary and an impairment charge is recorded as a reduction in the carrying value of the investment. |
• | Other non-operating (income) expensesinclude costs associated with financings, litigation and settlement costs and other items that relate to the financing and investing activities associated with our assets and not to the ongoing operating performance of our assets, both consolidated and unconsolidated, as well as the change in fair market value of our warrants issued in connection with the Yucaipa transaction. |
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• | Income tax expense (benefit).All of our foreign subsidiaries are subject to local jurisdiction corporate income taxes. Income tax expense is reported at the applicable rate for the periods presented. We are subject to Federal and state income taxes. Income taxes for the nine months ended September 30, 2010 and 2009 were computed using our calculated effective tax rate. We also recorded net deferred taxes related to cumulative differences in the basis recorded for certain assets and liabilities. |
• | Noncontrolling interest.Noncontrolling interest constitutes our third-party food and beverage joint venture partner’s interest in the profits of the restaurant ventures at certain of our hotels as well as the percentage of membership units in Morgans Group, our operating company, owned by Residual Hotel Interest LLC, our former parent, as discussed in note 2 of our consolidated financial statements. |
• | Income (loss) from discontinued operations, net of tax.In March 2010, Mondrian Scottsdale was foreclosed and we were terminated as the property’s manager. As such, we have recorded the income or loss earned from Mondrian Scottsdale in the income (loss) from discontinued operations, net of tax, on the accompanying consolidated financial statements. |
• | Preferred stock dividends and accretion.Dividends attributable to our outstanding preferred stock and the accretion of the fair value discount on the issuance of the preferred stock are reflected as adjustments to our net loss to arrive at net loss attributable to common stockholders, as discussed in note 8 of our consolidated financial statements. |
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Three Months Ended | ||||||||||||||||
Sept. 30, | Sept. 30, | |||||||||||||||
2010 | 2009 | Changes ($) | Changes (%) | |||||||||||||
(Dollars in thousands) | ||||||||||||||||
Revenues: | ||||||||||||||||
Rooms | $ | 35,100 | $ | 32,026 | $ | 3,074 | 9.6 | % | ||||||||
Food and beverage | 16,017 | 18,116 | (2,099 | ) | (11.6 | ) | ||||||||||
Other hotel | 2,077 | 2,284 | (207 | ) | (9.1 | ) | ||||||||||
Total hotel revenues | 53,194 | 52,426 | 768 | 1.5 | ||||||||||||
Management fee-related parties and other income | 4,547 | 3,998 | 549 | 13.7 | ||||||||||||
Total revenues | 57,741 | 56,424 | 1,317 | 2.3 | ||||||||||||
Operating Costs and Expenses: | ||||||||||||||||
Rooms | 11,061 | 10,423 | 638 | 6.1 | ||||||||||||
Food and beverage | 14,426 | 14,163 | 263 | 1.9 | ||||||||||||
Other departmental | 1,322 | 1,485 | (163 | ) | (11.0 | ) | ||||||||||
Hotel selling, general and administrative | 12,275 | 11,969 | 306 | 2.6 | ||||||||||||
Property taxes, insurance and other | 3,650 | 4,569 | (919 | ) | (20.1 | ) | ||||||||||
Total hotel operating expenses | 42,734 | 42,609 | 125 | 0.3 | ||||||||||||
Corporate expenses, including stock compensation | 8,045 | 8,507 | (462 | ) | (5.4 | ) | ||||||||||
Depreciation and amortization | 8,173 | 7,234 | 939 | 13.0 | ||||||||||||
Restructuring, development and disposal costs | 1,064 | 489 | 575 | (1 | ) | |||||||||||
Impairment loss on receivables from unconsolidated joint venture | 5,499 | — | 5,499 | (1 | ) | |||||||||||
Total operating costs and expenses | 65,515 | 58,839 | 6,676 | 11.3 | ||||||||||||
Operating loss | (7,774 | ) | (2,415 | ) | (5,359 | ) | (1 | ) | ||||||||
Interest expense, net | 8,610 | 12,842 | (4,232 | ) | (33.0 | ) | ||||||||||
Equity in loss of unconsolidated joint venture | 1,435 | 19,482 | (18,047 | ) | (92.6 | ) | ||||||||||
Impairment loss on development project | — | 11,914 | (11,914 | ) | (1 | ) | ||||||||||
Other non-operating expenses | 20,471 | 869 | 19,602 | (1 | ) | |||||||||||
Loss before income tax expense (benefit) | (38,290 | ) | (47,522 | ) | 9,232 | (19.4 | ) | |||||||||
Income tax expense (benefit) | 236 | (19,494 | ) | 19,730 | (1 | ) | ||||||||||
Net loss before loss attributable to noncontrolling interest | (38,526 | ) | (28,028 | ) | (10,498 | ) | 37.5 | |||||||||
Net loss attributable to non controlling interest | 1,452 | 817 | 635 | 77.7 | ||||||||||||
Net loss from continuing operations | (37,074 | ) | (27,211 | ) | (9,863 | ) | 36.2 | |||||||||
Loss from discontinued operations | (3 | ) | (606 | ) | 603 | (99.5 | ) | |||||||||
Net loss | (37,077 | ) | (27,817 | ) | (9,260 | ) | 33.3 | |||||||||
Preferred stock dividends and accretion | 2,164 | — | 2,164 | (1 | ) | |||||||||||
Net loss attributable to common stockholders | $ | (39,241 | ) | $ | (27,817 | ) | $ | (11,424 | ) | 41.1 | ||||||
(1) | Not meaningful. |
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Three Months Ended | ||||||||||||||||
Sept. 30, | Sept. 30, | |||||||||||||||
2010 | 2009 | Change ($) | Change (%) | |||||||||||||
Occupancy | 86.0 | % | 82.7 | % | — | 4.0 | % | |||||||||
ADR | $ | 232 | $ | 222 | $ | 10 | 4.3 | % | ||||||||
RevPAR | $ | 199 | $ | 184 | $ | 15 | 8.5 | % |
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Three Months Ended | ||||||||||||||||
Sept. 30, | Sept. 30, | |||||||||||||||
2010 | 2009 | Change ($) | Change (%) | |||||||||||||
Occupancy | 61.3 | % | 57.2 | % | — | 7.2 | % | |||||||||
ADR | $ | 290 | $ | 265 | $ | 25 | 9.4 | % | ||||||||
RevPAR | $ | 178 | $ | 152 | $ | 26 | 17.3 | % |
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Nine Months Ended | ||||||||||||||||
Sept. 30, | Sept. 30, | |||||||||||||||
2010 | 2009 | Changes ($) | Changes (%) | |||||||||||||
(Dollars in thousands) | ||||||||||||||||
Revenues: | ||||||||||||||||
Rooms | $ | 99,443 | $ | 89,033 | $ | 10,410 | 11.7 | % | ||||||||
Food and beverage | 51,062 | 55,075 | (4,013 | ) | (7.3 | ) | ||||||||||
Other hotel | 6,730 | 6,788 | (58 | ) | (0.9 | ) | ||||||||||
Total hotel revenues | 157,235 | 150,896 | 6,339 | 4.2 | ||||||||||||
Management fee-related parties and other income | 14,079 | 11,311 | 2,768 | 24.5 | ||||||||||||
Total revenues | 171,314 | 162,207 | 9,107 | 5.6 | ||||||||||||
Operating Costs and Expenses: | ||||||||||||||||
Rooms | 31,377 | 30,051 | 1,326 | 4.4 | ||||||||||||
Food and beverage | 42,526 | 41,856 | 670 | 1.6 | ||||||||||||
Other departmental | 3,834 | 4,449 | (615 | ) | (13.8 | ) | ||||||||||
Hotel selling, general and administrative | 35,523 | 34,154 | 1,369 | 4.0 | ||||||||||||
Property taxes, insurance and other | 12,461 | 12,862 | (401 | ) | (3.1 | ) | ||||||||||
Total hotel operating expenses | 125,721 | 123,372 | 2,349 | 1.9 | ||||||||||||
Corporate expenses, including stock compensation | 27,270 | 25,295 | 1,975 | 7.8 | ||||||||||||
Depreciation and amortization | 23,529 | 22,279 | 1,250 | 5.6 | ||||||||||||
Restructuring, development and disposal costs | 2,930 | 2,020 | 910 | 45.0 | ||||||||||||
Impairment loss on receivables from unconsolidated joint venture | 5,499 | — | 5,499 | (1 | ) | |||||||||||
Total operating costs and expenses | 184,949 | 172,966 | 11,983 | 6.9 | ||||||||||||
Operating loss | (13,635 | ) | (10,759 | ) | (2,876 | ) | 26.7 | |||||||||
Interest expense, net | 33,907 | 35,791 | (1,884 | ) | (5.3 | ) | ||||||||||
Equity in loss of unconsolidated joint venture | 9,437 | 21,920 | (12,483 | ) | (56.9 | ) | ||||||||||
Impairment loss on development project | — | 11,914 | (11,914 | ) | (1 | ) | ||||||||||
Other non-operating expenses | 35,789 | 1,934 | 33,855 | (1 | ) | |||||||||||
Loss before income tax expense (benefit) | (92,768 | ) | (82,318 | ) | (10,450 | ) | 12.7 | |||||||||
Income tax expense (benefit) | 535 | (34,619 | ) | 35,154 | (1 | ) | ||||||||||
Net loss before loss attributable to noncontrolling interest | (93,303 | ) | (47,699 | ) | (45,604 | ) | 95.6 | |||||||||
Net loss attributable to non controlling interest | 2,033 | 399 | 1,634 | (1 | ) | |||||||||||
Net loss from continuing operations | (91,270 | ) | (47,300 | ) | (43,970 | ) | 93.0 | |||||||||
Income (loss) from discontinued operations | 17,162 | (1,158 | ) | 18,320 | (1 | ) | ||||||||||
Net loss | (74,108 | ) | (48,458 | ) | (25,650 | ) | 52.9 | |||||||||
Preferred stock dividends and accretion | 6,357 | — | 6,357 | (1 | ) | |||||||||||
Net loss attributable to common stockholders | $ | (80,465 | ) | $ | (48,458 | ) | $ | (32,007 | ) | 66.0 | ||||||
(1) | Not meaningful. |
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Nine Months Ended | ||||||||||||||||
Sept. 30, | Sept. 30, | |||||||||||||||
2010 | 2009 | Change ($) | Change (%) | |||||||||||||
Occupancy | 80.9 | % | 75.1 | % | — | 7.7 | % | |||||||||
ADR | $ | 235 | $ | 230 | $ | 5 | 2.4 | % | ||||||||
RevPAR | $ | 190 | $ | 172 | $ | 18 | 10.3 | % |
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Nine Months Ended | ||||||||||||||||
Sept. 30, | Sept. 30, | |||||||||||||||
2010 | 2009 | Change ($) | Change (%) | |||||||||||||
Occupancy | 63.5 | % | 57.3 | % | — | 10.8 | % | |||||||||
ADR | $ | 310 | $ | 298 | $ | 12 | 3.8 | % | ||||||||
RevPAR | $ | 196 | $ | 171 | $ | 25 | 15.0 | % |
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• | deletes the financial covenant requiring us to maintain certain leverage ratios; |
• | revises the fixed charge coverage ratio (defined generally as the ratio of consolidated EBITDA excluding Mondrian Scottsdale’s EBITDA for the periods ending June 30, 2009 and September 30, 2009 and Clift’s EBITDA for all periods to consolidated interest expense excluding Mondrian Scottsdale’s interest expense for the periods ending June 30, 2009 and September 30, 2009 and Clift’s interest expense for all periods) that we are required to maintain for each four-quarter period to no less than 0.90 to 1.00 from the previous fixed charge coverage ratio of no less than 1.75 to 1.00. As of September 30, 2010, our fixed charge coverage ratio was 1.35x; |
• | limits defaults relating to bankruptcy and judgment to certain events involving us, Morgans Group and subsidiaries that are parties to the Amended Revolving Credit Facility; |
• | prohibits capital expenditures with respect to any hotels owned by us, the borrowers, or our subsidiaries, other than maintenance capital expenditures for any hotel not exceeding 4% of the annual gross revenues of such hotel and certain other exceptions; |
• | revises certain provisions related to permitted indebtedness, including, among other things, deleting certain provisions permitting unsecured indebtedness and indebtedness for the acquisition or expansion of hotels; |
• | prohibits repurchase of our common equity interests by us or Morgans Group; |
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• | imposes certain limits on any secured swap agreements entered into after the effective date of the Amended Revolving Credit Facility; and |
• | provides for a waiver of any default or event of default, to the extent that a default or event of default existed for failure to comply with any financial covenant as of June 30, 2009 and/or for the four fiscal quarters ended June 30, 2009 under the revolving credit facility before it was amended. |
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November 9, 2010 | Morgans Hotel Group Co. | |||
/s/Fred J. Kleisner | ||||
President and Chief Executive Officer | ||||
/s/ Richard Szymanski | ||||
Chief Financial Officer and Secretary |
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Exhibit | ||||
Number | Description | |||
2.1 | Agreement and Plan of Merger, dated May 11, 2006, by and among Morgans Hotel Group Co., MHG HR Acquisition Corp., Hard Rock Hotel, Inc. and Peter Morton (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on May 17, 2006) | |||
2.2 | First Amendment to Agreement and Plan of Merger, dated as of January 31, 2007, by and between Morgans Hotel Group Co., MHG HR Acquisition Corp., Hard Rock Hotel, Inc., (solely with respect to Section 1.6 and Section 1.8 thereof) 510 Development Corporation and (solely with respect to Section 1.7 thereof) Peter A. Morton (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on February 6, 2007) | |||
3.1 | Amended and Restated Certificate of Incorporation of Morgans Hotel Group Co.(incorporated by reference to Exhibit 3.1 to Amendment No. 5 to the Company’s Registration Statement on Form S-1 (File No. 333-129277) filed on February 6, 2006) | |||
3.2 | Amended and Restated By-laws of Morgans Hotel Group Co. (incorporated by reference to Exhibit 3.2 to Amendment No. 5 to the Company’s Registration Statement on Form S-1 (File No. 333-129277) filed on February 6, 2006) | |||
3.3 | Certificate of Designations for Series A Preferred Securities (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on October 16, 2009) | |||
4.1 | Specimen Certificate of Common Stock of Morgans Hotel Group Co. (incorporated by reference to Exhibit 4.1 to Amendment No. 3 to the Company’s Registration Statement on Form S-1 (File No. 333-129277) filed on January 17, 2006) | |||
4.2 | Junior Subordinated Indenture, dated as of August 4, 2006, between Morgans Hotel Group Co., Morgans Group LLC and JPMorgan Chase Bank, National Association (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on August 11, 2006) | |||
4.3 | Amended and Restated Trust Agreement of MHG Capital Trust I, dated as of August 4, 2006, among Morgans Group LLC, JPMorgan Chase Bank, National Association, Chase Bank USA, National Association, and the Administrative Trustees Named Therein (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on August 11, 2006) | |||
4.4 | Stockholder Protection Rights Agreement, dated as of October 9, 2007, between Morgans Hotel Group Co. and Mellon Investor Services LLC, as Rights Agent (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on October 10, 2007) | |||
4.5 | Amendment to the Stockholder Protection Rights Agreement, dated July 25, 2008, between the Company and Mellon Investor Services LLC, as Rights Agent (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on July 30, 2008) | |||
4.6 | Amended and Restated Stockholder Protection Rights Agreement, dated as of October 1, 2009, between Morgans Hotel Group Co. and Mellon Investor Services LLC, as Rights Agent (including Forms of Rights Certificate and Assignment and of Election to Exercise as Exhibit A thereto and Form of Certificate of Designation and Terms of Participating Preferred Stock as Exhibit B thereto) (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on October 2, 2009) |
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Exhibit | ||||
Number | Description | |||
4.7 | Amendment No. 1, dated as of October 15, 2009, to Amended and Restated Stockholder Protection Rights Agreement, dated as of October 1, 2009, between Morgans Hotel Group Co. and Mellon Investor Services LLC, as Rights Agent (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K filed on October 16, 2009) | |||
4.8 | Amendment No. 2, dated as of April 21, 2010, to Amended and Restated Stockholder Protection Rights Agreement, dated as of October 1, 2009, between Morgans Hotel Group Co. and Mellon Investor Services LLC, as Rights Agent (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on April 22, 2010) | |||
4.9 | Indenture related to the Senior Subordinated Convertible Notes due 2014, dated as of October 17, 2007, by and among Morgans Hotel Group Co., Morgans Group LLC and The Bank of New York, as trustee (including form of 2.375% Senior Subordinated Convertible Note due 2014) (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on October 17, 2007) | |||
4.10 | Supplemental Indenture, dated as of November 2, 2009, by and among Morgans Group LLC, the Company and The Bank of New York Mellon Trust Company, National Association (as successor to JPMorgan Chase Bank, National Association), as Trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on November 4, 2009) | |||
4.11 | Registration Rights Agreement, dated as of October 17, 2007, between Morgans Hotel Group Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K filed on October 17, 2007) | |||
10.1 | * | Waiver Agreement, dated as of April 21, 2010, by and among Morgans Hotel Group Co., Yucaipa American Alliance Fund II, L.P. and Yucaipa American Alliance (Parallel) Fund II, L.P. | ||
10.2 | Amendment to Forbearance Agreement, dated September 10, 2010, by and between Bank of America, National Association, as successor by merger to LaSalle Bank National Association, as Trustee for the Holders of Wachovia Bank Commercial Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2007-WHALE 8 and Henry Hudson Holdings LLC, a Delaware limited liability company, the Borrower (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 14, 2010) | |||
10.3 | Amendment to Forbearance Agreement, dated September 10, 2010, by and between Bank of America, National Association, as successor by merger to LaSalle Bank National Association, as Trustee for the Holders of Wachovia Bank Commercial Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2007-WHALE 8 and Mondrian Holdings LLC, a Delaware limited liability company, the Borrower (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on September 14, 2010) | |||
10.4 | * | Amendment Number One to Ground Lease, dated September 17, 2010, by and among Hasina, LLC, a California limited liability company, Tarstone Hotels, LLC, a Delaware limited liability company, Kalpana, LLC, a California limited liability company, Rigg Hotel, LLC, a California limited liability company, and JRIA, LLC, a Delaware limited liability company, and Clift Holdings, LLC, a Delaware limited liability company | ||
10.5 | * | Limited Guaranty of Lease, dated September 17, 2010, by Morgans Group LLC, a Delaware limited liability company to and for the benefit of Hasina, LLC, a California limited liability company, Tarstone Hotels, LLC, a Delaware limited liability company, Kalpana, LLC, a California limited liability company, Rigg Hotel, LLC, a California limited liability company, and JRIA, LLC, a Delaware limited liability company |
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Exhibit | ||||
Number | Description | |||
10.6 | * | Credit Agreement, dated as of October 6, 2006, by and among Morgans Group LLC, as Borrower, Beach Hotel Associates LLC, as Florida Borrower, Morgans Hotel Group Co., Wachovia Capital Markets, LLC, and Citigroup Global Markets Inc., as Joint Lead Arrangers and Joint Book Runners, Wachovia Bank, National Association, as Administrative Agent, Citigroup Global Markets Inc., as Syndication Agent, and the Financial Institutions Initially Signatory Thereto and their Assignees Pursuant to Section 13.5 Thereto, as Lenders | ||
10.7 | * | Fifth Amendment to Credit Agreement; and Waiver Agreement dated as of August 5, 2009, by and among Morgans Group LLC, Beach Hotel Associates LLC, Morgans Holdings LLC and Royalton LLC, as Borrowers, Morgans Hotel Group Co., each of the Guarantors party thereto, each of the Lenders party thereto and Wachovia Bank, National Association, as Agent | ||
10.8 | * | Loan and Security Agreement, dated as of October 6, 2006, between Henry Hudson Senior Mezz LLC and Wachovia Bank, National Association | ||
10.9 | * | Deed of Trust, Security Agreement, Assignment of Rents and Fixture Filing, dated October 6, 2006, between Mondrian Holdings LLC, as Borrower, and First American Title Insurance Company, as Trustee for the benefit of Wachovia Bank, National Association, as Lender | ||
10.10 | * | Securities Purchase Agreement, dated as of October 15, 2009, by and among the Registrant and Yucaipa American Alliance Fund II, L.P. and Yucaipa American Alliance (Parallel) Fund II, L.P. | ||
10.11 | * | Real Estate Fund Formation Agreement, dated as of October 15, 2009, by and between Yucaipa American Alliance Fund II, LLC and the Registrant | ||
10.12 | * | Registration Rights Agreement, dated as of October 15, 2009, by and between the Registrant and Yucaipa American Alliance Fund II, L.P., Yucaipa American Alliance (Parallel) Fund II, L.P. and Yucaipa American Alliance Fund II, LLC | ||
31.1 | * | Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
31.2 | * | Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
32.1 | * | Certification by the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
32.2 | * | Certification by the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
* | Filed herewith. |
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