November 28, 2005
Mail Stop 4561
Richard Szymanski
Chief Financial Officer
Morgans Hotel Group Co.
475 Tenth Avenue
New York, NY 10018
Re: Morgans Hotel Group Co.
Registration Statement on Form S-1
Filed October 27, 2005
File No. 333-129277
Dear Mr. Szymanski:
We have reviewed your filing and have the following
comments.
Where indicated, we think you should revise your document in
response
to these comments. If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary. Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
information so we may better understand your disclosure. After
reviewing this information, we may raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
General
1. Please update your financial statements as required by Article
3-
12 of Regulation S-X.
2. Please tell us whether any of your underwriters or their
affiliates may be parties to the loan to be made to Morgans Hotel
Group Management, LLC, or will receive proceeds of this offering
from
the repayment of a portion of the loans described on page 34.
3. Refer to your formation and structuring agreement. Please tell
us
why the Distribution Transactions and the Exchange Transactions,
as
those terms are defined in the agreement, should not be integrated
with this offering. If integration is warranted, please tell us
why
this transaction does not constitute a roll-up within the meaning
of
Item 901 of Regulation S-K.
4. Please provide us with copies of the artwork or graphics you
intend to use in the prospectus. We may have further comment.
Prospectus Summary, page 1
Formation and Structuring Transactions, page 6
5. Please expand your disclosure to summarize the effect of the
formation and restructuring transactions, including the effects on
equity ownership, asset ownership, and management. We note the
disclosure in footnotes (2) and (3); however, it is not clear how
and
why interests in the predecessor entities are being distributed.
Also, clearly summarize the interests of the related parties in
the
formation and structuring transactions.
Summary Historical Financial and Operating Data, page 9
6. Please clarify whether you use EBITDA and Adjusted EBITDA as a
measure of operating performance or liquidity. Your disclosure
states that the measure is useful because it assesses your ability
to
generate cash from operations to pay taxes, to service debt and to
undertake capital expenditures. This appears to be a measure of
liquidity and should be reconciled to cash flow from operations.
In
addition please revise to include disclosures that discuss the
material limitations of excluding items such as interest expense,
income tax expense and depreciation and amortization. Refer to
question 8 in the Frequently Asked Questions regarding the use of
non-GAAP financial measures and Item 10(e) of Regulation S-K.
Risk Factors, page 12
7. To the extent material, please discuss risk related to new debt
to
be incurred by your predecessor`s management company, risk related
to
the repatriation of earnings, and risk related to future
condominium
conversions.
8. We note from page 127 that you are negotiating a revolving
credit
facility with entities affiliated with your underwriters. This
appears to represent a conflict of interest that should be
disclosed
in your risk factors section. Please quantify the fees to be
received by the affiliates and discuss any requirements as to the
size or timing of the offering that may be imposed by lenders.
Also,
please provide us with any preliminary documentation of this loan.
9. Please discuss the risks associated with your history of net
losses.
Risks Related to Our Business
We have substantial debt..., page 17
10. Please expand your discussion of debt covenants and the Clift
bankruptcy to provide more detail, including:
* what conditions, if any, you may be subject to as a result of
Clift`s plan of reorganization;
* what property interests your I.S. London joint venture holds;
* the nature of the covenant violated by I.S. London and the
amount
of debt that is subject to acceleration;
* the conditions the proposed refinancing is subject to and the
amount of the proposed refinancing; and
* whether you are negotiating the I.S. London`s refinancing with
entities affiliated with your underwriters.
The revolving credit facility..., page 19
11. Please indicate the approximate size of the anticipated
facility
and discuss risk associated with your failure to obtain it.
Risks Related to Our Organization and Structure
We may experience conflicts of interest with significant
stockholders
...., page 25
12. Please revise to quantify the approximate percentage of their
time that Messrs. Scheetz and Hamamoto will devote to your
business.
The negotiations involving our formation transactions..., page 26
13. Please revise to discuss the possibility that the value of
units
issued in the formation transaction will not reflect the value of
assets contributed. Also, please tell us why your discussion is
limited to the value of equity held by NorthStar Partnership L.P.
and
its affiliates.
Formation and Structuring Transactions, page 31
14. Include a section entitled "Accounting Treatment" and explain
there the basis for your accounting treatment under SFAS 141.
This
should include how you determined that the transfer of assets
should
occur at historical cost and how you accounted for the
contribution
of all of the membership interests in MHG Management Company to
Morgans Group LLC in return for membership interests in Morgans
Group
LLC with a value based on the IPO price equal to $20 million.
Tell
us whether this contribution was at fair value of historical
value.
It appears that this could be a distribution. Please cite the
accounting literature that you have relied upon in your response.
15. Please describe these transactions in more detail, including:
* the amount of debt to be incurred by the management company;
* the amount of debt to be repaid by Morgans Hotel Group LLC with
the
proceeds of the management company`s loan (and the specific
lenders
and amounts involved, including identification of any affiliates
of
you or your underwriters);
* how interests in Morgans Group LLC will be set and change
following
the entity`s formation, the initial contribution of properties and
the transfer of the management company for $20 million; and
* why these transfers are being conducted separately.
16. Please identify each interest that Morgans Hotel Group LLC
will
contribute to Morgans Group LLC, as reflected in Section 1.2 of
the
Formation and Structuring Agreement. If any additional interests
not
identified in the agreement are being transferred, please disclose
those interests as well.
17. Please explain what, if any, assets will be held by Morgans
Hotel
Group LLC following the contribution. Please be specific as to
the
nature of the "other interests" to be retained by Morgans Hotel
Group
LLC. Also, please quantify any remaining interests in Morgans
Group
LLC, other than your own, following the transfer of units to you
by
entities affiliated with Messrs. Hamamoto, Scheetz and Schrager.
Finally, please quantify the dollar value of redeemable membership
interests and shares to be held by each entity or individual
involved
in your formation transactions.
18. Please describe in more detail the terms of redemption and
exchange provided for in the limited liability company agreement
of
Morgans Group LLC. Provide similar disclosure regarding the terms
for redemption or exchange for the membership interests of Morgans
Hotel Group LLC.
19. Footnote (3) to the table on page 33 suggests that the
distribution and exchange of Morgans Group LLC membership
interests
owned by Morgan Hotel Group LLC may not occur. Please revise the
narrative leading into the table to discuss the conditions, if
any,
to the distribution and exchange.
20. Please discuss the impact on your management resulting from
the
formation and structuring transactions.
Capitalization, page 36
21. Please revise to remove cash and cash equivalents and
restricted
cash from your capitalization table.
Management`s Discussion and Analysis of Financial Condition...,
page
42
Overview, page 42
22. Please revise the Overview to discuss your history of net
losses
and to explain the reasons for increasing net losses in light of
increases in revenues for each of your last three fiscal years.
23. On page 43, please revise to indicate when each of your
management agreements terminates. Also, please explain how the
minority interest in your food and beverage joint venture is
determined.
Operating Results, page 47
24. Please explain why food and beverage revenue remained
relatively
constant in recent periods despite significant increases in room
revenue. If room revenue includes some food and beverage service,
please make this clear.
Liquidity and Capital Resources, page 58
25. Refer to your statement that short-term liquidity needs will
be
satisfied out of existing working capital and cash provided by
operations. Please disclose whether you have in prior periods
used
debt proceeds to fund short-term liquidity requirements. If so,
please revise your disclosure to explain the basis of your belief
regarding the satisfaction of short-term liquidity needs going
forward.
26. Please expand your discussion of liquidity to include:
* the TCI Chevron put described on page 77;
* the phase-out of property tax abatements described on page 16;
* the potential acceleration of debt related to I.S. London and
the
proposed refinancing;
* a more detailed description of the reserve requirements
contained
in your debt instruments, as described on page 100;
* the put right associated with your Burford Hotels Limited joint
venture, as described on page 111.
Investing Activities, page 59
27. Please explain why your debt service shortfall payments to
I.S.
London have increased from period to period and clarify whether
the
payments made in 2004 and 2003 were also related to these
shortfalls.
Financing Activities, page 59
28. Refer to disclosure on page 60 that $82.9 million was used to
repay corporate debt of Morgans Hotel Group LLC. Please explain
the
nature of this debt in more detail and identify the lenders.
Debt, page 60
29. Please account for the $6 million difference between the debt
referred to in this section and the $659.8 million referred to on
page 64.
30. Specifically describe and quantify the debt service coverage
requirements under the Hotel Debt. Please disclose whether you
currently are in compliance with those covenants and whether you
will
continue to be in compliance following the public offering.
Contractual Obligations, page 60
31. On page 61, please explain in more detail how the Blackacre
preferred return is calculated. Also, please explain the
circumstances under which you may be required to purchase
Blackacre`s
membership.
Quantitative and Qualitative Disclosures About Market Risk, page
64
32. Please disclose the limit on upward adjustments to variable
rate
debt as a result of your hedge agreements, which cap the
applicable
LIBOR rate at 4.25%, and disclose when these hedges expire.
Currency Exchange Risk, page 64
33. Please quantify this risk to the extent you consider it to be
material. Discuss how much of your earnings are subject to
repatriation and what impact a change in prevailing rates could
have.
Our Business and Properties, page 65
34. Refer to an October 28, 2004 story in Caterer and Hotelkeeper.
Please discuss your plans to sell the Sanderson and St. Martins
Lane
hotels, if any.
35. Where relevant, please discuss your experience with larger
formats in more detail and any practical limitations on your
ability
to expand. We note in this regard that the average daily rate and
revPAR for your Hudson property are significantly lower than all
of
your other properties expect for the Clift, which only recently
came
out of bankruptcy. We further note, from page 12, that you have
"relatively high" fixed operating costs.
36. Please provide objective support for, carefully define, and
quantify if possible the key terms contained in the following
assertions here and in your prospectus summary:
* that you are widely credited with "establishing and defining"
the
boutique hotel sector;
* that the boutique hotel sector is "rapidly expanding;"
* that each of your properties was designed by a "world-renowned"
designer;
* that your hotels enjoy "increased" occupancy levels and pricing
power. In responding to this comment, please provide investors
with
a frame of reference, including average occupancy and pricing
rates
in your key markets;
* that your hotels enjoy "sustained" customer loyalty;
* that your hotels have "the potential for superior" revPAR. In
responding to this comment, please explain on page 67 the basis
for
your belief and provide investors with a frame of reference;
* that the Zagat survey ranks certain of your restaurants as
"among
the most popular" in New York, Los Angeles and London and that
they
attract "significant" local customers;
* that you have achieved an "exceptional customer satisfaction
rating;"
* that your brands offer "highly attractive opportunities" to
expand
and export your business and improve your ability to secure joint
ventures and management agreements;
* that your managers have "extensive" experience in all
disciplines
necessary to operate and grow your business. Please remove
references throughout your prospectus to the aggregate or average
experience of your managers. A discussion of specific managers
with
applicable experience is acceptable. Also, please indicate on
page
68 which-if any-of your managers enjoys public company experience;
* that your service level is "unparalleled;"
* that your property management systems improve your
profitability;
* that your sales and catering system comprises a "powerful
strategic
tool;"
* that your customer relationship management system lowers your
operating costs and increases your revenues (please be specific).
In general, you should avoid describing yourself with loose
marketing-oriented phrases that are not objectively verifiable.
Our Growth Strategy, page 70
37. Please quantify what you mean by "strong" internal and
external
growth.
Internal Growth, page 70
38. Please provide copies of all reports cited here and in your
industry overview and indicate whether any of these reports were
prepared for you. Also, please disclose that the 2005 data is
annualized and may not be indicative of full-year results. If you
are aware of any seasonal factors that could reduce growth rates
calculated on an annualized basis, please discuss them here.
External Growth, page 71
Target Markets, page 71
39. Please discuss the limitations placed on your ability to
expand
internationally in light of your commitments under the Burford
Hotels
Limited joint venture.
Brand Extensions, page 72
40. Refer to your statement that heightened levels of residential
sales activity may reflect an opportunity to generate proceeds for
reinvestment. Please explain what you mean by this and disclose
the
basis of your belief.
Company History, page 72
41. Please discuss the departure of Mr. Schrager and any recent
asset
sales, including the Paramount and Miramar hotels.
Our Hotel Properties, page 74
42. We note that you have presented a non-GAAP measure, operating
income before depreciation, in your chart presenting certain
summarized information by property. In order to present non-GAAP
measures, a reconciliation of the differences between the non-GAAP
financial measures disclosed with the most directly comparable
financial measure calculated and presented in accordance with GAAP
must be presented. For reference, please see Item 10(e)(1)(i)(B)
of
Regulation S-K. Since operating income per property is not
reported,
please revise your chart accordingly.
43. We note that you have presented information in this chart
related
to equity method joint ventures. Since you derive revenue from
your
wholly-owned properties differently than from these joint
ventures,
the information related to these properties should be presented
separately. Please revise your filing accordingly.
44. For each hotel that you do not own in fee simple, please
describe
in more detail the terms of your management agreement.
Individual Property Information
Hudson, page 77
45. You disclose that you own approximately 91% and lease 4% of
the
square footage of the Hudson building on page 77; however, you
also
disclose that you have a 100% interest in the Hudson in the charts
on
pages 2 and 66. Please reconcile these differences and revise
your
disclosure appropriately.
46. You disclose that you leased your interests in Hudson in 2000
to
Hudson Leaseco LLC, an entity in which you own a 0.1% interest.
Please provide us with more information regarding your
relationship
with this entity and how you have accounted for the entire
transaction. Cite the accounting literature relied upon in your
response.
47. Please explain in more detail what an SRO is and who occupies
these rooms.
Clift, page 82
48. You disclose in Note 2, page F-9, that no impairment write-
downs
were recorded during the six months ended June 30, 2005 or the
years
ended December 31, 2004, 2003, or 2002. In light of the
continuing
operating losses at Clift and the filing for bankruptcy by Clift
Holdings LLC in August 2003, please tell us how you determined
that
no impairment existed during the periods covered by your financial
statements. Reference is made to SFAS 144.
Employees, page 88
49. Refer to a November 6, 2005 story in the New York Times.
Please
tell us whether you are a member of the "mutual assistance pact"
discussed in that story and, if so, please discuss its terms.
Mortgage and Other Indebtedness Outstanding After This Offering,
page
100
50. With regard to the $106.2 million in mezzanine loans, please
explain in more detail the conditions necessary to effect your
option
to extend the maturity date.
51. Please denominate the loan to I.S. London in U.S. dollars.
Also,
please describe your liability under this loan. If you are
liable,
please tell us why you have not discussed this loan in your
section
on liquidity or revise accordingly.
Management, page 102
52. We note that the Clift hotel emerged from bankruptcy in 2004.
Please provide the disclosure required by Item 401(f)(1) of
Regulation S-K as applicable to each of your executive officers
and
directors.
Certain Relationships and Related Party Transactions, page 107
53. Please identify affiliated holders of interests in NorthStar
Partnership L.P., RSA Associates L.P. and Morgans Hotel Group, to
the
extent these interests are not held through NorthStar and RSA, and
quantify those interests.
54. For each transaction, please disclose the amounts paid or
received since the beginning of your last fiscal year or that of
your
predecessor.
Agreements with Ian Schrager, page 109
55. Please explain the bonus structure. Where relevant, please
discuss Mr. Schrager`s ability to compete with you.
Option Agreement, page 110
56. Please quantify the put, disclose the source of funds to
satisfy
it, and explain the reason for providing RSA Associates LP with
this
right. Also, please disclose what the purchase price for 5% of
Morgans Hotel Group LLC would have been, had RSA Associates
decided
to exercise it. Finally, please revise to clarify Mr. Schrager`s
interest in this agreement.
Joint Venture Agreements, page 110
57. Please disclose and quantify the interest of any of your
directors, executive officers, or five percent stockholders in
each
of the joint ventures. Provide similar disclosure with respect to
Philips South Beach, LLC
58. Please identify the hotels associated with each of the joint
venture agreements. In the case of the Hudson and Clift hotels,
please disclose when you are required to satisfy the management
fee,
in the event of losses.
59. With respect to the buyout provisions, please disclose the
EBITDA
multiple for each joint venture and disclose whether either party
may
force (via put or call) the other party to buy or sell its
interest.
In the event that a sale may be forced, please expand your
discussion
of liquidity to cover this contingent obligation, including the
potential liability based on current EBITDA levels.
Burford Hotels Limited Joint Venture, page 111
60. Please discuss any financial parameters relevant to the offer
that one party may make and that the other party may be forced to
accept. Also, please disclose whether the purchase price must be
paid in cash.
Ownership and Management of Shore Club, page 112
61. Please explain in more detail the basis for and potential
amount
of incentive payments. Also, please discuss the "customary
termination provisions" in detail and indicate whether the hotel
has
failed to meet the required percentage of its operating profit
projection or occupancy requirement in any year. Explain briefly
why
the occupancy requirement is tied to Delano.
NorthStar Hospitality LLC Preferred Equity Interest in Clift, page
112
62. Separately quantify the amount of each related party`s
interest
in NorthStar`s preferred equity payments. Also, please disclose
the
approximate amount that NorthStar will be entitled to receive upon
redemption of the preferred equity upon consummation of the IPO
and
separately disclose each related party`s interest in the
redemption
payments.
Principal Stockholders, page 113
63. In your footnotes, please disclose the affiliations between
your
officers and directors and your 5% stockholders. Also, please
disclose the natural person with voting and investment control
over
the shares held by your 5% holders.
Description of the Operating Agreement of Morgans Group LLC, page
116
64. Please disclose any preferences the holders of units may
(currently or in the future) enjoy relative to the holders of
common
stock, other than an allocation of profit or loss. In this
regard,
we note from page 118 that you may issue "preferred" units.
Underwriting, page 125
65. We note from page 127 that a prospectus will be available
through
the Internet. Please identify any members of the underwriting
syndicate that will make copies of the preliminary prospectus
available online or will engage in the electronic offer, sale or
distribution of the shares. Please provide an analysis of how the
underwriters` procedures will comply with Section 5 of the
Securities
Act. Alternatively, please confirm that their procedures have
been
reviewed and cleared by the Division`s Office of Chief Counsel and
that the procedures have not changed since such clearance. If you
become aware of any additional members of the underwriting
syndicate
that may engage in electronic offers, sales, or distributions
after
you respond to this comment, please promptly supplement your
response
to identify those members.
66. We note that your underwriters have performed services for you
in
the past. Please be more specific as to the nature and timing of
those services and the amounts paid.
Directed Share Program, page 128
67. We note that the underwriters have reserved shares for sale
directly to your customers, business associates and other persons.
Please tell us the procedures investors must follow in order to
purchase the offered securities, including how and when the
underwriters or the company will receive communications or funds.
In
this regard, please describe the process for confirmation and
settlement of sales to directed share purchasers, including:
* whether directed share purchasers will be required to establish
accounts before the effective time, and if so, what if any funds
will
be put in newly established brokerage accounts before the
effective
date;
* what, if any, relationship will any funds deposited into new
accounts have to the expected price for the shares being allocated
to
the directed share purchaser; and
* how the procedures for the directed share program will differ
from
the procedures for the general offering to the public.
Also, please provide us with a copy of all materials that you or
the
underwriters will send to prospective investors in connection with
the directed share program.
Financial Statements
Combined Statements of Cash Flows, page F-6
68. You disclose an impairment loss of $800,000 on your statement
of
cash flow for 2004. You also disclose in Note 2 that no
impairment
charges were recorded related to long-lived assets, goodwill, and
investments in unconsolidated joint ventures. Please tell us what
this impairment charge relates to and please update your
disclosure
accordingly.
Note 2 - Summary of Significant Accounting Policies
Basis of Presentation, page F-8
69. Tell us how you determined that the six restaurant ventures
were
variable interest entities in accordance with paragraph 5 of FIN
46(R).
70. Please expand your disclosure regarding the six restaurant
ventures that you consolidate to include all information required
by
paragraph 23 of FIN 46(R).
Impairment of Long-Lived Assets, page F-9
71. We note that you review held and used long-lived assets
periodically for impairment. Please expand your disclosure to
explain how impairment is determined.
Investments in and Advances to Unconsolidated Joint Ventures, page
F-
10
72. We note that no impairment charges were recognized in the six
month periods ended June 30, 2005 or 2004 or the years ended
December
31, 2004, 2003, or 2002. We also note, per review of Note 4, that
the I.S. Europe Limited joint venture has experienced continuing
operating losses for over three years and is also in violation of
certain of its loan covenants. Please tell us how you concluded
that
this investment does not require an other-than-temporary
impairment
charge.
Note 4 - Investments in and Advances to Unconsolidated Joint
Ventures, page F-13
73. We note that you continue to fund I.S. Europe Limited, the
joint
venture operating company for your U.K. hotels. Please tell us
how
you evaluated this joint venture under FIN 46(R); please be sure
to
tell us whether or not the joint venture is considered a variable
interest entity, who the primary beneficiary of the entity is (if
considered a VIE), and how you came to your conclusions.
74. Please provide us with your FIN 46(R) analysis to determine
whether the Restaurant Venture - SC London should be consolidated.
Tell us the percentage owned of this joint venture.
75. Please tell us the accounting guidance that you used to
determine
the proper treatment of the designer fees related to I.S. Europe.
Note 5 - Other Liabilities
Payable due Investor Member of Hudson Leaseco LLC and Deferred
Gain,
page F-16
76. On page 77 you disclose that you only have a 0.1% interest in
Hudson Leaseco LLC, and Chevron TCI, Inc. has the other 99.9%
interest in the entity. Please expand your footnote disclosure to
include this information. Additionally, please tell us the
accounting guidance that you used in accounting for the creation
of
Hudson Leaseco LLC.
Note 6 - Long-Term Debt and Capital Lease Obligations, page F-17
77. You disclose that the 5 Hotel Debt is subject to a Spread
Maintenance Premium and Exit Fee upon prepayment. You also
disclose
that the Spread Maintenance Premium would be calculated under more
favorable terms and the Exit Fee would be waived if the 5 Hotel
Debt
is prepaid as a result of the IPO. Please expand this disclosure
to
quantify the amounts of the Spread Maintenance Premium and the
Exit
Fee. Please additionally update your liquidity discussion in the
MD&A to detail this arrangement and management`s intentions
regarding
prepayment.
78. You disclose on page 18 in your discussion of risks related to
your business that your existing notes payable contain limitations
on
your ability to incur additional debt on specific properties.
Please
expand your footnote disclosure to include a discussion of these
restrictions on additional borrowings.
Construction Settlement, page F-21
79. Please tell us where the $10 million settlement amount is
included in the 2002 Combined Statements of Operations.
Repurchase and Reimbursement Agreement, page F-21
80. You disclose that you may be required to purchase Blackacre`s
Class B membership interest in Shore Club under certain
circumstances. Please tell us and expand your discussion to
include
the certain circumstances that would require you to purchase more
of
Blackacre`s interest in Shore Club. Additionally, please tell us
if
you re-performed your analysis of Shore Club under FIN 46(R) when
you
purchased 33.3% of Blackacre`s Class B and Class C membership
interests for $4.8 million in August 2005.
Information Nor Required In Prospectus
Item 15. Recent Sales of Unregistered Securities.
81. Please revise to include an analysis of the exemption
available
for your formation transaction.
Exhibits
82. Please file your legal and tax opinions with the next
amendment
or provide draft copies for us to review. We must review the
opinions before we declare the registration statement effective.
As appropriate, please amend your registration statement in
response to our comments. You may wish to provide us with marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendments that keys your responses to our
comments and provides any requested information. Detailed cover
letters greatly facilitate our review. Please understand that we
may
have additional comments after reviewing your amendment and
responses
to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings to be certain that the
filing includes all information required under the Securities Act
of
1933 and that they have provided all information investors require
for an informed decision. Since the company and its management
are
in possession of all facts relating to a company`s disclosure,
they
are responsible for the accuracy and adequacy of the disclosures
they
have made.
Notwithstanding our comments, in the event the company
requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that:
* should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
* the company may not assert staff comments and the declaration of
effectiveness as defense in any proceeding initiated by the
Commission or any person under the federal securities laws of the
United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in connection with our review of
your
filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the above registration
statement. We will act on the request and, pursuant to delegated
authority, grant acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendments for further
review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
You may contact Jessica Barberich at 202-551-3782 or Daniel
Gordon, Accounting Branch Chief, at 202-551-3486 if you have
questions regarding comments on the financial statements and
related
matters. Please contact Geoffrey Ossias at 202-551-3404 or me at
202-551-3780 with any other questions.
Sincerely,
Karen J. Garnett
Assistant Director
cc: Robert W. Downes (via facsimile)
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Richard Szymanski
Morgans Hotel Group Co.
November 28, 2005
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