<PAGE> 1
================================================================================
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY
(AS PERMITTED BY RULE 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
BOYKIN LODGING COMPANY
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
XXXXXXXXXXXXXXXX
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid: Not Applicable Not Applicable
(2) Form, Schedule or Registration Statement No.: Not Applicable
(3) Filing Party: Not Applicable
(4) Date Filed: Not Applicable
================================================================================
<PAGE> 2
BOYKIN LODGING COMPANY
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
------------------------
Notice is hereby given that the Annual Meeting of Shareholders of Boykin
Lodging Company will be held at the Cleveland Marriott East, 3663 Park East
Drive, Beachwood, Ohio 44122, on Tuesday, May 6, 1997, at 10:00 a.m., Cleveland
time, for the following purposes:
1. To elect seven directors, each to serve until the next annual
meeting of the shareholders and until his successor has been duly elected
and qualified;
2. To receive reports at the meeting. No action constituting approval
or disapproval of the matters referred to in said reports is contemplated;
and
3. To transact such other business as may properly come before the
meeting.
Only shareholders of record at the close of business on March 27, 1997,
will be entitled to notice of and to vote at the meeting or any adjournment
thereof. Shareholders are urged to complete, date and sign the enclosed proxy
and return it in the enclosed envelope. The principal address of Boykin Lodging
Company is Terminal Tower, Suite 1500, 50 Public Square, Cleveland, Ohio 44113.
By order of the Board of Directors,
RAYMOND P. HEITLAND,
Secretary
Dated: April 4, 1997
YOUR VOTE IS IMPORTANT.
PLEASE SIGN, DATE AND RETURN YOUR PROXY
<PAGE> 3
BOYKIN LODGING COMPANY
PROXY STATEMENT
------------------------
This proxy statement is furnished in connection with the solicitation of
proxies to be used at the Annual Meeting of Shareholders of Boykin Lodging
Company, an Ohio corporation (the "Company"), to be held at the Cleveland
Marriott East, 3663 Park East Drive, Beachwood, Ohio 44122, on Tuesday, May 6,
1997, at 10:00 a.m., Cleveland time, and at any adjournment thereof. This proxy
statement and the accompanying notice and proxy will first be sent to
shareholders by mail on or about April 4, 1997.
Annual Report. A copy of the Company's Annual Report to Shareholders for
the fiscal year ended December 31, 1996, is enclosed with this proxy statement.
Solicitation and Revocation of Proxies. This solicitation of proxies is
made by and on behalf of the Board of Directors. The cost of the solicitation of
proxies will be borne by the Company. In addition to solicitation of proxies by
mail, regular employees of the Company or its affiliates may solicit proxies by
telephone or facsimile.
If the enclosed proxy is signed and returned, the shares represented
thereby will be voted in accordance with any specification made therein by the
shareholder. In the absence of any such specification, they will be voted to
elect the director nominees set forth under "Election of Directors" below. A
shareholder's presence at the meeting, without more, will not operate to revoke
his or her proxy. The proxy is revocable by a shareholder at any time insofar as
it has not been exercised by giving notice to the Company in writing at its
address indicated on the attached Notice of Annual Meeting of Shareholders, or
in open meeting.
Outstanding Shares. The close of business on March 27, 1997, has been fixed
as the record date for the determination of shareholders entitled to notice of
and to vote at the meeting. On that date, the Company's voting securities
outstanding consisted of 9,516,251 Common Shares, without par value, each of
which is entitled to one vote at the meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of Boykin Lodging Company common shares (the "Common Shares") as of
February 28, 1997, by: (a) the Company's directors (all of whom are also
director nominees); (b) each other person who is known by the Company to own
beneficially more than 5% of the outstanding Common Shares; (c) the Company's
Chief Executive Officer and the two other most highly compensated executive
officers named in the Summary Compensation Table; and (d) the Company's
executive officers and directors as a group. The following beneficial owners
have sole voting power and sole investment power with respect to all Common
Shares set forth opposite their names.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
- ------------------------------------------------------------------- ------------------ --------
<S> <C> <C>
Robert W. Boykin................................................... 100(1) *
Raymond P. Heitland................................................ 0(1) 0
Mark L. Bishop..................................................... 0 0
Albert T. Adams.................................................... 0 0
Lee C. Howley, Jr.................................................. 0 0
William N. Hulett III.............................................. 0 0
Frank E. Mosier.................................................... 0 0
Ivan J. Winfield................................................... 1,000 *
All Executive Officers and Directors as a Group.................... 1,100 *
</TABLE>
- ---------------
* Less than 1%.
(1) Robert W. Boykin beneficially owns 577,112 limited partnership interests
("Units") in Boykin Hotel Properties, L.P., an Ohio limited partnership (the
"Partnership"); John E. Boykin and William J.
1
<PAGE> 4
Boykin, Robert W. Boykin's brother and father, beneficially own 484,381 and
150,000 Units, respectively; and Raymond P. Heitland beneficially owns
10,650 Units. The Company owns approximately an 84.5% general partnership
interest in the Partnership. Pursuant to the Amended and Restated Agreement
of Limited Partnership of the Partnership, each of Robert W. Boykin, John E.
Boykin, William J. Boykin, and Raymond P. Heitland may cause the Partnership
to purchase his Units on and after November 4, 1999, for cash (the value of
one Unit, subject to certain factors, being equal to the value of one Common
Share of the Company). However, the Company may elect, subject to certain
conditions, to deliver Common Shares of the Company in exchange for tendered
Units, in lieu of cash. Assuming conversion of their Units into Company
Common Shares, Robert W. Boykin, John E. Boykin, William J. Boykin and
Raymond P. Heitland would beneficially own 5.30%, 4.45%, 1.38% and less than
1%, respectively, of the Company.
ELECTION OF DIRECTORS
In accordance with the Company's Code of Regulations, the number of
directors has been fixed at seven. At the Annual Meeting, the shares represented
by proxies, unless otherwise specified, will be voted for the election of the
seven nominees hereinafter named, each to serve until the next Annual Meeting of
Shareholders and until his successor is duly elected and qualified.
The director nominees are identified in the following table. Each is
currently a director of the Company. Messrs. Boykin and Heitland were elected as
directors on March 15, 1996. Each of Messrs. Adams, Howley, Hulett, Mosier and
Winfield was elected as a director in connection with the Company's initial
public offering on November 4, 1996.
If for any reason any of the nominees is not a candidate when the election
occurs (which is not expected), the Board of Directors expects that proxies will
be voted for the election of a substitute nominee designated by management. The
following information is furnished with respect to each person nominated for
election as a director.
NOMINEES FOR ELECTION AT THE ANNUAL MEETING
<TABLE>
<CAPTION>
PERIOD EXPIRATION
OF SERVICE OF TERM
PRINCIPAL OCCUPATION AS A FOR WHICH
NAME AND AGE AND BUSINESS EXPERIENCE DIRECTOR PROPOSED
- -------------------- ------------------------------- ------------ ----------
<S> <C> <C> <C>
Robert W. Boykin Chairman of the Board of 1996 to date 1998
47 Directors, President and Chief
Executive Officer of the
Company
Raymond P. Heitland Secretary, Treasurer and Chief 1996 to date 1998
Financial Officer of the
61 Company
Albert T. Adams Partner, Baker & Hostetler LLP 1996 to date 1998
46
Lee C. Howley, Jr. President, Howley & Company 1996 to date 1998
49
William N. Hulett Co-Chairman and Chief Executive 1996 to date 1998
Officer of the Rock and Roll
53 Hall
of Fame and Museum
Frank E. Mosier Director of Associated Estates 1996 to date 1998
Realty Corporation and
66 Centerior
Energy Corporation
Ivan J. Winfield Associate Professor at Baldwin 1996 to date 1998
63 Wallace College
</TABLE>
Each of the above nominees for election as a director has engaged in the
principal occupation or activity indicated for at least five years, except as
described below.
2
<PAGE> 5
Mr. Boykin served as the President and Chief Executive officer of Boykin
Management Company from 1985 until November 1996. Mr. Heitland served as the
Chief Financial Officer of Boykin Management Company from 1970 until November
1996. Mr. Hulett served as president of Stouffer Hotel Company from 1981 to May
1993, and as president of William N. Hulett & Associates, a consulting firm,
from May 1993 until September 1995. Mr. Mosier served as Vice Chairman of the
Advisory Board of BP America Inc., a producer and refiner of petroleum products,
from August 1991 to August 1993. Mr. Winfield served as managing partner of
Coopers & Lybrand, L.L.P.'s Northeast Ohio practice from 1990 until October
1994.
Mr Adams is a director of Developers Diversified Realty Corporation and
Associated Estates Realty Corporation. Mr. Howley is a director of LESCO, Inc.
Mr. Hulett is a director of Developers Diversified Realty Corporation. Mr.
Mosier is a director of Associated Estates Realty Corporation and Centerior
Energy Corporation. Mr. Winfield is a director of HMI Industries, Inc. and a
trustee of the Fairport Funds.
The Company consummated its initial public offering of Common Shares on
November 4, 1996. During the fiscal year ended December 31, 1996, the Board of
Directors held one meeting. The Board of Directors has appointed an Audit
Committee, an Executive Committee, a Compensation Committee and a Long-Term
Incentive Plan Committee. The Board of Directors does not have a Finance or
Nominating Committee. Each member of the Board of Directors, except Mr.
Winfield, attended the meeting of the Board of Directors held in fiscal 1996. No
committee meeting was held in fiscal 1996.
The Audit Committee comprises Messrs. Adams, Howley, Hulett, Mosier and
Winfield. The Audit Committee recommends annually to the Board of Directors the
independent public accountants for the Company, reviews with the independent
public accountants the arrangements for and scope of the audits to be conducted
by them and the results of those audits, and reviews various financial and
accounting matters affecting the Company.
The Executive Committee comprises Messrs. Boykin, Heitland and Adams. The
Executive Committee, during the intervals between the meetings of the Company's
Board of Directors, possesses and may exercise all of the powers of the Board of
Directors in the management of the business and affairs of the Company, except
as otherwise provided (i) by law, (ii) in the Amended and Restated Articles of
Incorporation of the Company or in the Code of Regulations of the Company (in
each case as amended from time to time), or (iii) by action of the Board of
Directors.
The Compensation Committee comprises Messrs. Adams, Howley, Hulett, Mosier
and Winfield. The Compensation Committee periodically reviews and determines the
compensation, including fringe benefits and incentive compensation, of officers
and management personnel of the Company.
The Long-Term Incentive Plan Committee, which comprises Messrs. Howley,
Hulett, Mosier and Winfield, administers the Company's Long-Term Incentive Plan
and determines the employees of the Company who may participate in the grant of
any award (including share options), and the terms thereof, under the Long-Term
Incentive Plan.
Directors' Compensation. Each director who is not an officer of the Company
or of a subsidiary of the Company is compensated at the rate of $16,000 per year
(prorated to $4,000 in fiscal 1996). Each director also receives $1,000 for
attendance at each meeting of the Board of Directors and for each meeting of any
committee. Directors of the Company who are also Company employees are not paid
any director's fee. Upon completion of the Company's initial public offering on
November 4, 1996, each director who was not an employee of the Company (Messrs.
Adams, Howley, Hulett, Mosier and Winfield) received an option for 5,000 Common
Shares, exercisable at $20 per share on and after November 4, 1997. In addition,
directors who are not employees of the Company are eligible to participate in
the Company's Directors' Deferred Compensation Plan (the "Deferred Plan"). The
Deferred Plan, which is administered by Company officers who are not eligible to
participate in it, allows directors to defer receipt of the fees payable to them
by the Company for their services as directors. The value of the amounts
credited to a director in the Deferred Plan increases or decreases based on the
market value of the Company's Common Shares.
3
<PAGE> 6
COMPENSATION COMMITTEE REPORT
Introduction. The Compensation Committee (the "Committee") is responsible
for determining the compensation to be paid to the Company's executive officers.
The Committee is also responsible for making major policy decisions with respect
to health care and other benefit plans. The Long-Term Incentive Plan is
administered by the Company's Long-Term Incentive Plan Committee, which consists
of all of the members of the Committee except Mr. Adams.
The Committee's philosophy with respect to the compensation of the
Company's executive officers is (i) to provide a competitive total compensation
package that enables the Company to attract and retain qualified executives and
align their compensation with the Company's overall business strategies, and
(ii) through the Long-Term Incentive Plan Committee, to provide each executive
officer with a significant equity stake in the Company through share options.
To this end, the Committee determines executive compensation with a focus
on compensating executive officers based on their responsibilities and the
Company's performance. The primary components of the Company's executive
compensation program are (i) base salaries and certain other annual
compensation, (ii) bonuses, and (iii) share options.
Base Salaries and Other Annual Compensation. The base salaries and certain
other compensation for the Company's executive officers in 1996 were determined
with reference to the experience of the executives in the industry, together
with comparisons of compensation paid by companies of similar size in the real
estate investment trust industry--including certain, but not all, of the
companies included in NAREIT (National Association of Real Estate Investment
Trusts). This compensation was determined after consulting with the Company's
financial advisors and the managing underwriters of the Company's initial public
offering.
The base salaries for Messrs. Boykin, Heitland and Bishop are set forth in
employment agreements entered into between those officers and the Company as of
November 4, 1996. See "Employment Agreements." These agreements provide for
initial annual base salaries of $250,000, $150,000 and $140,000, respectively,
for Messrs. Boykin, Heitland and Bishop. In addition, each of the employment
agreements provides for use of an automobile, health insurance and certain other
benefits. The Committee believes that these annual compensation packages are
commensurate with Messrs. Boykin's, Heitland's and Bishop's experience and
responsibility.
Bonuses. Under the employment agreements, Mr. Boykin is entitled to a bonus
of from 10% to 90% of his annual base salary, and Messrs. Heitland and Bishop
are entitled to bonuses of from 5% to 45% of their annual base salaries, if
Funds From Operations per Common Share for any year exceed, by 5% to 20% or
more, the Funds From Operations per Common Share for the immediately preceding
year. The bonuses payable for 1996 were prorated. The formula for determining
these bonuses was determined after consultation with the managing underwriters
of the Company's initial public offering. "Funds From Operations" means income
(loss) before minority interest (computed in accordance with generally accepted
accounting principles), excluding gains (losses) from debt restructuring and
sales of property (including furniture and equipment), plus real estate-related
depreciation and amortization (excluding amortization of financing costs), and
after adjustments for unconsolidated partnerships and joint ventures.
Share Options. All of the Company's executive officers are eligible to
receive options to purchase Common Shares of the Company under the Long-Term
Incentive Plan. The Company believes that share option grants are a valuable
motivating tool and provide a long-term incentive to management. Share option
grants reinforce long-term goals by providing the proper nexus between the
interests of management and the interests of the Company's shareholders.
Accordingly, the Long-Term Incentive Plan Committee granted to current executive
officers options to purchase an aggregate of 400,000 Common Shares under the
Long-Term Incentive Plan (250,000, 75,000 and 75,000 for Messrs. Boykin,
Heitland and Bishop, respectively). The number of options granted to each of the
executive officers was determined after consultation with the managing
underwriters of the Company's initial public offering and was based on the
expected contribution of each such officer to the performance of the Company.
Albert T. Adams
Lee C. Howley, Jr.
William N. Hulett III
Frank E. Mosier
Ivan J. Winfield
4
<PAGE> 7
EXECUTIVE COMPENSATION
The following information is set forth with respect to the Company's Chief
Executive Officer and each of the Company's other executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
--------------------
ANNUAL COMPENSATION(1) AWARDS
------------------------------------ --------------------
OTHER RESTRICTED ALL
ANNUAL SHARE SHARE OTHER
NAME AND FISCAL SALARY BONUS COMPENSATION AWARD(S) OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($)(2) ($) (#)(3) ($)(4)
- ---------------------------- ------ ------- ------- ------------ ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Robert W. Boykin 1996 $41,896 $18,853 -- -- 250,000 $1,046
Chairman, President 1995 -- -- -- -- -- --
and Chief Executive 1994 -- -- -- -- -- --
Officer
Raymond P. Heitland 1996 25,137 5,027 -- -- 75,000 570
Chief Financial Officer, 1995 -- -- -- -- -- --
Treasurer and Secretary 1994 -- -- -- -- -- --
Mark L. Bishop 1996 23,462 4,692 -- -- 75,000 --
Senior Vice President -- 1995 -- -- -- -- -- --
Acquisition and Development 1994 -- -- -- -- -- --
</TABLE>
- ---------------
(1) Amounts for fiscal year 1996 reflect compensation paid by the Company from
November 4, 1996 (the date of its initial public offering) through the end
of the fiscal year. The Company did not pay compensation for any period
prior to November 4, 1996.
(2) Total perquisites and other personal benefits for each of the named
executive officers do not exceed the threshold amounts specified in the
regulations promulgated by the Securities and Exchange Commission.
(3) See the Option/SAR table on page 6 for a schedule of options vesting.
(4) Amounts shown represent the Company's contributions on behalf of Messrs.
Boykin and Heitland to the Company's nonqualified savings plan.
EMPLOYMENT AGREEMENTS
Robert W. Boykin, Raymond P. Heitland and Mark L. Bishop entered into
employment contracts with the Company in connection with the Company's initial
public offering. Mr. Boykin's agreement provides for an initial three-year term
that is automatically extended for an additional year at the end of each year of
the agreement, subject to the right of either party to terminate the agreement
by giving two years' prior written notice. The agreements for Messrs. Heitland
and Bishop each provide for an initial one-year term that is automatically
extended for an additional year at the end of each year of the agreement,
subject to the right of either party to terminate the agreement by giving six
months' prior written notice. Each of Messrs. Boykin, Heitland and Bishop is
prohibited from competing with the Company during the term of his employment
agreement and, in the case of Messrs. Boykin and Heitland, for a term of two
years thereafter, and in the case of Mr. Bishop, for a term of six months
thereafter.
Each agreement provides for the annual base salary and bonus described
under the Compensation Committee Report, above, and for the use of an
automobile, medical and dental benefits, vacation and sick leave and certain
additional compensation. Mr. Boykin's employment agreement also provides for
membership in a country club, a golf club, and a downtown business club, and for
certain life insurance benefits.
5
<PAGE> 8
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
------------------------------------------------ POTENTIAL REALIZABLE
PERCENTAGE OF VALUE AT ASSUMED
TOTAL OPTIONS ANNUAL RATES OF STOCK
GRANTED TO PRICE APPRECIATION FOR
EMPLOYEES OPTION TERM(3)
OPTIONS FISCAL EXERCISE PRICE EXPIRATION -------------------------
NAME GRANTED(1) YEAR(2) ($/SHARE) DATE 5% 10%
- --------------------- ---------- -------------- -------------- ------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Robert W. Boykin 250,000 62.50% $20.00 November 2006 $3,144,450 $7,968,700
Raymond P. Heitland 75,000 18.75% 20.00 November 2006 943,335 2,390,610
Mark L. Bishop 75,000 18.75% 20.00 November 2006 943,335 2,390,610
</TABLE>
- ---------------
(1) Options are not exercisable during the first 12 months after the date of
grant. Mr. Boykin's option agreement provides that: (i) incentive stock
options vest with respect to 5,000 shares on November 4 of each of 1997
through 2005, and (ii) nonqualified stock options vest with respect to
68,333, 68,333 and 68,334 shares on November 4, 1997, November 4, 1998 and
November 4, 1999, respectively. Mr. Heitland's option agreement provides
that: (i) incentive stock options vest with respect to 5,000 shares on
November 4 of each of 1997 through 2003, and (ii) nonqualified stock options
vest with respect to 13,333, 13,333 and 13,334 shares on November 4, 1997,
November 4, 1998 and November 4, 1999, respectively. Mr. Bishop's option
agreement provides that: (i) incentive stock options vest with respect to
5,000 shares on November 4 of each of 1997 through 1999, and (ii)
nonqualified stock options vest with respect to 20,000 shares on November 4
of each of 1997 through 1999.
(2) Based on 400,000 options granted to all employees during the fiscal year.
(3) These amounts are based on hypothetical appreciation rates of 5% and 10% and
are not intended to forecast the actual future appreciation of the Company's
shares. No gain to optionees is possible without an actual increase in the
price of the Company's shares, which would benefit all of the Company's
shareholders. All calculations are based on a ten-year option period.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
SHARES FISCAL YEAR-END FISCAL YEAR-END
ACQUIRED ON VALUE (#) ($)(1)
EXERCISE REALIZED EXERCISABLE/ EXERCISABLE/
NAME (#) ($) UNEXERCISABLE UNEXERCISABLE
- ------------------------- ----------- -------------- --------------- ---------------
<S> <C> <C> <C> <C>
Robert W. Boykin -- -- -0-/250,000 -0-/$1,000,000
Raymond P. Heitland -- -- -0-/ 75,000 -0-/ 300,000
Mark L. Bishop -- -- -0-/ 75,000 -0-/ 300,000
</TABLE>
- ---------------
(1) Represents the difference between the aggregate exercise price of the
options and the closing price of the Company's Common Shares ($24 per share)
on December 31, 1996.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Albert T. Adams, a member of the Compensation Committee, is a partner in
Baker & Hostetler LLP, which acts as general legal counsel for the Company. The
Company expects that Baker & Hostetler LLP will continue to provide legal
services in that capacity in 1997.
TRANSACTIONS WITH MANAGEMENT
In connection with the Company's formation and initial public offering on
November 4, 1996, Messrs. Boykin and Heitland and others exchanged their
interests in various entities (the "Contributed
6
<PAGE> 9
Partnerships") for limited partnership interests ("Units") in Boykin Hotel
Properties, L.P. (the "Partnership"). See "Security Ownership of Certain
Beneficial Owners." The Company owns approximately an 84.5% general partnership
interest in the Partnership.
The Partnership owns twelve hotels that it leases to Boykin Management
Company Limited Liability Company, an Ohio limited liability company ("BMC").
Robert W. Boykin and his brother John E. Boykin indirectly own approximately a
54% and a 46% equity interest, respectively, in BMC. John E. Boykin is a
director and the secretary of BMC, and Robert W. Boykin is a director of BMC.
For the fiscal year ended December 31, 1996, BMC paid to the Partnership
approximately $3,257,641 in rent. BMC will pay the Partnership rent in 1997. In
addition, on December 31, 1996, the Company had a payable to BMC of $681,000,
primarily for the reimbursement of capital expenditure costs incurred on behalf
of the Company.
In December 1996, the Partnership paid approximately $3.1 million to BMC in
repayment of loans made to the Contributed Partnerships by Boykin Management
Company, the predecessor of BMC.
In addition, pursuant to a Shared Services and Office Space Agreement, the
Company pays BMC $2,000 per month for the right to use certain office space and
receive certain services. The Company also reimburses BMC for certain expenses,
such as long-distance telephone charges and travel expenses, incurred by BMC on
the Company's behalf.
7
<PAGE> 10
PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total return of a
hypothetical investment in the Common Shares with the cumulative total return of
a hypothetical investment in each of the New York Stock Exchange Market Index
and the Media General Financial Services, Inc. Industry Group 432 (Real Estate
Investment Trusts) Index based on the respective market price of each such
investment at October 30, 1996, November 30, 1996, and December 31, 1996,
assuming in each case an initial investment of $100 on October 30, 1996, and
reinvestment of dividends.
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year Covered) Boykin Lodging Co. Industry Index Broad Market
<S> <C> <C> <C>
October 1996 100.00 100.00 100.00
November 1996 101.88 104.14 106.64
December 1996 121.50 114.26 105.25
</TABLE>
8
<PAGE> 11
SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Any shareholder proposal intended to be presented at the Company's 1998
Annual Meeting of Shareholders must be received by the Company at Terminal
Tower, Suite 1500, 50 Public Square, Cleveland, Ohio 44113, on or before
December 6, 1997, for inclusion in the Company's proxy statement and form of
proxy relating to the 1998 Annual Meeting of Shareholders.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and owners of more than 10% of the Company's
Common Shares, to file with the Securities and Exchange Commission (the "SEC")
and the New York Stock Exchange initial reports of ownership and reports of
changes in ownership of Common Shares and other equity securities of the
Company. Executive officers, directors and owners of more than 10% of the Common
Shares are required by SEC regulations to furnish the Company with copies of all
forms they file pursuant to Section 16(a).
To the Company's knowledge, based solely on its review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1996, all
Section 16(a) filing requirements applicable to its executive officers,
directors and greater than 10% beneficial owners were complied with, except that
the initial reports of ownership of the executive officers and directors were
filed within several days after the Company's initial public offering, rather
than on or prior to the effective date of the Company's registration statement
on Form S-11 as required by Section 16.
OTHER MATTERS
The Company has not selected its independent public accountants for the
current fiscal year. This selection will be made later in the year by the Board
of Directors. Representatives of Arthur Andersen LLP, which served as the
Company's independent public accountants during the fiscal year ended December
31, 1996, are expected to be present at the annual meeting and will have the
opportunity to make a statement if they so desire and will be available to
respond to appropriate questions.
If the enclosed proxy is executed and returned to the Company, the persons
named in it will vote the shares represented by that proxy at the meeting. The
form of proxy permits specification of a vote for the election of directors as
set forth under "Election of Directors" above, the withholding of authority to
vote in the election of directors, or the withholding of authority to vote for
one or more specified nominees.
When a choice has been specified in the proxy, the shares represented will
be voted in accordance with that specification. If no specification is made,
those shares will be voted at the meeting to elect directors as set forth under
"Election of Directors" above. Under Ohio law and the Company's Amended and
Restated Articles of Incorporation, as amended, broker non-votes and abstaining
votes will not be counted in favor of or against any nominee. Director nominees
who receive the greatest number of affirmative votes will be elected directors.
If any other matter properly comes before the meeting, the persons named in the
proxy will vote thereon in accordance with their judgment. Management does not
know of any other matter that will be presented for action at the meeting.
By order of the Board of Directors,
RAYMOND P. HEITLAND,
Secretary
Dated: April 4, 1997
9
<PAGE> 12
BOYKIN LODGING COMPANY
P R O X Y
---------
The undersigned hereby appoints ROBERT W. BOYKIN, RAYMOND P.
HEITLAND and ROBERT A. WEIBLE, and each of them, attorneys and
proxies of the undersigned, with full power of substitution, to
attend the annual meeting of shareholders of Boykin Lodging Company
to be held at the Cleveland Marriott East, 3663 Park East Drive,
Beachwood, Ohio 44122, on Tuesday, May 6, 1997, at 10:00 a.m.,
Cleveland time, or any adjournment thereof, and to vote the number
of shares of the Company which the undersigned would be entitled to
vote, and with all the power the undersigned would possess if
personally present, as follows:
1. [ ] FOR (except as noted below), or [ ] WITHHOLD AUTHORITY
to vote for, the following nominees for election as
directors, each to serve until the next annual meeting of
the shareholders and until his successor has been duly
elected and qualified: Robert W. Boykin, Raymond P.
Heitland, Albert T. Adams, Lee C. Howley, Jr., William N.
Hulett III, Frank E. Mosier and Ivan J. Winfield.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY
PARTICULAR NOMINEE, WRITE THAT NOMINEE'S NAME
ON THE LINE PROVIDED BELOW.)
---------------------------------------------------------------
2. On such other business as may properly come before the
meeting.
THE PROXIES WILL VOTE AS SPECIFIED ABOVE, OR IF A CHOICE IS NOT
SPECIFIED, THEY WILL VOTE FOR THE NOMINEES LISTED IN ITEM 1.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY
Receipt of the Notice of
Annual Meeting of
Shareholders and Proxy
Statement dated April 4,
1997, is hereby acknowledged.
Dated: ___________ , 1997
-----------------------------
-----------------------------
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Signature(s)
(Please sign exactly as your
name or names appear hereon,
indicating, where proper,
official position or
representative capacity.)
