SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): January 4, 2000
CAVANAUGHS HOSPITALITY CORPORATION
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(Exact Name of Registrant as Specified in Its Charter)
WASHINGTON
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(State or Other Jurisdiction of Incorporation)
001-13957 91-1032187
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(Commission File Number) (I.R.S. Employer
Identification No.)
201 W. North River Drive, Suite 100
Spokane, Washington 99201
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(Address of Principal Executive Offices)
(Zip Code)
(509) 459-6100
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
ITEM 2. Acquisition or Disposition of Assets
On January 4, 2000, Cavanaughs Hospitality Corporation (Company),
acquired through multiple purchase agreements all of the outstanding
stock of WestCoast Hotels Inc. a Washington Corporation and 100% of
the interest in Bellevue Inn LLC. The sellers are; Lisa Swanbeck-
Johnson as the owner of 100% of the stock of PNWW Holdings, Inc., a
Washington corporation, Rodney D. Olson, D. Michael Bashaw, and
October Hotel Investors, LLC, a Washington limited liability company.
These combined entities own the following hotel properties and
percentage interests: WestCoast SeaTac Hotel a 146 room hotel located
in Seattle Washington, one hundred percent (100%) ownership of the
improvements and lessee interest in ground lease; Bellevue Inn a 181
room hotel located in Bellevue, Washington, one hundred percent (100%)
ownership of the lessee interest and option agreement; WestCoast Vance
Hotel a 165 room hotel located in Seattle, Washington, a .3 percent
general partner interest including a 15% backend return if certain
investment returns are achieved; Executive Park Hotel a 107 room hotel
located in Phoenix, Arizona, a .3 percent general partner interest
including a 15% backend return if certain investment returns are
achieved; Hotel La Jolla at the Shores, a 108 room hotel located in La
Jolla, California, a 7.1% limited partnership interest. Other assets
of the company include the trademarks of WestCoast Hotels,
marketing/franchise agreements for 23 hotels with 4,019 rooms,
management agreements for 15 owned and third party owned hotels with
2,530 rooms, and all the associated contracts, assets and liabilities.
The acquisition is in accordance with the Purchase and Sale Agreements
dated December 17, 1999. The purchase of the stock and membership
interests was completed on January 4, 2000 for a total price of
approximately $61.4 million including the assumed debt of WestCoast
Hotels Inc. and subsidiaries.
The purchase price was paid all cash at closing. The source of funds
for the acquisition was a combination of loan proceeds from
Cavanaughs Hospitality Corporation's Revolving Credit Facility,
Convertible Bonds of $7,000,000 issued to the sellers which pay a 7%
interest rate and can be converted to common stock of the Company at a
$15.00 per share price, assumed debt which existed in WestCoast Hotel
Inc., and earnings of the Company. The purchase price was determined
through arm's length negotiations with the Sellers, an unrelated third
party.
ITEM 7. Financial Statements, Pro Forma Financial Information and
Exhibits
(a) Financial Statements of the property acquired
The audited financial statement will be filed with Form 8-KA
within 60 days.
(b) Pro forma financial information
Pro forma financial information will be filed with Form 8-KA
within 60 days.
(c) Exhibits
10.19 Purchase and Sale Agreement dated December 17, 1999 by and
among Cavanaughs Hospitality Corporation and Lisa Swanbeck-
Johnson as the owner of 100% of the stock of PNW Holdings,
Inc., a Washington corporation which is the owner of 100%
of the stock of WC Coast Holdings, Inc., a Washington
corporation, Rodney D. Olson, a married man and D. Michael
Bashaw, a married man.
10.20 Membership Interest Purchase Agreement dated December 17,
1999, by and among Cavanaughs Hospitality Corporation, a
Washington corporation (the "Buyer"), October Hotel
Investors, LLC, a Washington limited liability company.
10.21 First Amendment to Membership Interest Purchase Agreement
made December 30, 1999, by and among Cavanaughs Hospitality
Corporation, a Washington corporation, October Hotel
Investors, LLC, a Washington limited liability company and
M and S Hotel LLC, a Washington limited liability company.
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 hereunder duly authorized.
Dated: January 18, 2000 CAVANAUGHS HOSPITALITY CORPORATION
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By: /s/ Art Coffey
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Executive Vice President/Chief
Financial Officer