1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K-A
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) January 2, 1997
RFS HOTEL INVESTORS, INC.
(Exact name of registrant as specified in its charter)
Tennessee 0-22164 62-1534743
(State or other jurisdiction (Commission File No.) I.R.S. Employer
of incorporation) (Identification No.)
(901) 767-7005
(Registrant's telephone number, including area code)
850 Ridge Lake Boulevard
Suite 220
Memphis, Tennessee 38120
(Address of principal executive offices)
(former name or former address, if changed since last report)
889 Ridge Lake Boulevard
Suite 100
Memphis, Tennessee 38120
2
This Form 8-K/A replaces the Company's Form 8-K/A filed on February 14, 1997.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On January 2, 1997, RFS Partnership, L.P., a Tennessee limited
partnership (the "Partnership") of which RFS Hotel Investors, Inc., a Tennessee
corporation (the "Registrant") serves as general partner, consummated the
acquisition of four hotel properties in California, three Sheraton Four Points
hotels and one Sheraton hotel (the "Hotels") as follows: (1) a 174 room
Sheraton Four Points hotel in Sunnyvale, California (the "Sunnyvale Hotel"),
(2) a 197 room Sheraton Four Points hotel in Bakersfield, California
(the "Bakersfield Hotel"), (3) a 214 room Sheraton Four Points hotel in
Pleasanton, California (the "Pleasanton Hotel") and (4) a 229 room Sheraton
hotel in San Jose, California (the "San Jose Hotel"). The four Hotels were
acquired from a group of affiliated sellers. The Sunnyvale Hotel was purchased
from Gus Enterprises-VIII, a California general partnership; the Bakersfield
Hotel was purchased from Gus Enterprises-X, a California limited partnership;
the Pleasanton Hotel was purchased from Gus Enterprises-XI, a California
limited partnership, and the San Jose Hotel was purchased from Gus
Enterprises-XII, a California limited partnership in negotiated transactions
(Gus Enterprises-VIII, Gus Enterprises-X, Gus Enterprises-XI and Gus
Enterprises-XIII are hereafter referred to as the "Selling Partnerships"). The
Selling Partnerships are unrelated to the Registrant. The Hotels were acquired
by the Partnership for an aggregate of 2,244,934 units of limited partnership
interest in the Partnership ("Units") and $52,019,821 in cash, which sum
includes closing costs, and of which $50,000,000 was obtained from the proceeds
of the Partnership's line of credit with Boatmen's Bank of Tennessee. The
Hotels will continue to be operated as hotel properties.
The 2,244,934 Units issued in connection with the acquisition of the
Hotels have redemption rights which enable the holders to redeem their Units in
exchange for shares of Common Stock of the Registrant on the one-for-one basis
or, at the election of the Registrant, for cash. Generally, the redemption
rights for the Units issued in connection with the Hotels may not be exercised
until July 1997. Annual distributions are payable on the Units generally equal
to the distributions on shares of Common Stock.
The Partnership has leased the Hotels to RFS, Inc., a wholly owned
subsidiary of Doubletree Corporation (the "Lessee") pursuant to percentage
leases which provide for rent equal to the greater of (i) fixed base rent or
(ii) percentage rent based on room revenues of the hotels. The percentage
leases for the Hotels have terms of fifteen years. The Lessee sub-leases the
restaurant at each of the Hotels (the "Restaurants") to non-affiliated
third-parties pursuant to subleases which provide for the payment of base rents
and additional rent based on a percentage of the Restaurants' revenues
exceeding defined thesholds. The Lessee pays rent for the Restaurants to the
Partnership based upon 90% of the rent received by the Lessee under the
subleases, subject to a minimum.
The rent for each of the Hotels is as follows:
Base Rent Participating Rent Formula
--------- --------------------------
Sunnyvale Hotel $1,733,847 Rooms: 45.9% of first $2,585,969; 52.6%
of next $2,475,928; 65% of excess over
$5,061,897; Restaurant: minimum of $75,000;
Food and Beverage: 5%
Bakersfield Hotel $ 675,768 Rooms: 23.5% of first $1,513,792; 45.6%
of next $1,449,385; 65% of excess over
$2,963,167; Restaurant: minimum of $90,000
2
3
Pleasanton Hotel $1,585,783 Rooms: 48.1% of first $2,407,568; 57.0%
of next $2,305,118; 65% of excess over
$4,712,686; Restaurant: minimum of $180,000;
Food and Beverage: 5%
San Jose Hotel $2,199,601 Room: 47% of first $3,506,412; 54.3% of
next $3,357,203; 65% of excess over
$6,863,615; Restaurant: minimum of $150,000
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS
(a) Financial Statements of the Hotels
The audited combined balance sheet as of December 31, 1995 and
the related combined statements of operations, partners'
equity and cash flows for the year then ended and the
unaudited combined balance sheet as of September 30, 1996 and
the related unaudited combined statements of operations,
partners' equity and cash flows for the nine months ended
September 30, 1995 and 1996, are filed as Exhibit 99.1 to
this Form 8-K-A.
(b) Pro Forma Financial Information
Unaudited pro forma financial information for RFS Hotel
Investors, Inc. as of September 30, 1996 and for the year ended
December 31, 1995 and for the nine months ended September 30,
1996 reflecting the acquisition of the Hotels is filed
as Exhibit 99.2 to this Form 8-K-A.
(c) Exhibits
*10.1 Hotel Purchase Agreement by and between Gus
Enterprises, VIII, a California general partnership,
and RFS Partnership, L.P., a Tennessee limited
partnership, dated December 3, 1996. The purchase
agreements for the other three Hotels are
substantially similar to this agreement.
23.1 Consent of Independent Accountants
99.1 Audited combined balance sheet as of December 31,
1995 and the related combined statements of
operations, partners' equity and cash flows for the
year then ended and the unaudited combined balance
sheets as of September 30, 1996 and the related
unaudited combined statements of operations,
partners' equity and cash flows for the nine months
ended September 30, 1995 and 1996.
99.2 Unaudited pro forma financial information for RFS
Hotel Investors, Inc. as of September 30, 1996 and
for the year ended December 31, 1995 and the nine
months ended September 30, 1996.
* Previously filed.
3
4
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 hereunto duly authorized.
RFS HOTEL INVESTORS, INC.
February 14, 1997 /s/ Michael J. Pascal
- - - -------------------- -----------------------------
Date Michael J. Pascal
Secretary and Treasurer
(Principal Financial Officer)
4
5
EXHIBIT INDEX
*10.1 Hotel Purchase Agreement by and between Gus Enterprises, VIII, a
California general partnership, and RFS Partnership, L.P., a Tennessee
limited partnership, dated December 3, 1996. The purchase agreements
for the other three Hotels are substantially similar to this
agreement.
23.1 Consent of Independent Accountants.
99.1 Audited combined balance sheets as of December 31, 1995 and the
related combined statements of operations, partners' equity and
cash flows for the year then ended and the unaudited combined balance
sheet as of September 30, 1996 and the related unaudited combined
statements of operations, partners' equity and cash flows for the nine
months ended September 30, 1995 and 1996.
99.2 Unaudited pro forma financial information for RFS Hotel
Investors, Inc. as of September 30, 1996 and for the year ended
December 31, 1995 and the nine months ended September 30, 1996.
* Previously filed.
5