<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB/A
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended March 31, 1997 Commission File Number 0-9659
----------------------------- ------
SIGNATURE INNS, INC.
(Exact name of registrant as specified in its charter)
INDIANA 35-1426996
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
250 EAST 96TH STREET, SUITE 450, INDIANAPOLIS, IN 46240
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (317) 581-1111
Check whether the Registrant (1) has filed all reports required to be filed by
Sections 13 or 15 (d) of the Securities Exchange Act of 1934 during the
preceding 12 months, and (2) has been subject to such filing requirements for
the past 90 days.
YES [X] NO [ ]
2,102,408 Common Shares were outstanding as of May 13, 1997.
<PAGE> 2
<TABLE>
<CAPTION>
SIGNATURE INNS, INC.
INDEX
Part I - FINANCIAL INFORMATION Page
----
<S> <C>
Item 1.Financial Statements (Unaudited)
Consolidated Statements of Operations 1
Three months ended March 31, 1997 and 1996
Pro Forma Consolidated Statements of Operations 2
Three months ended March 31, 1997 and 1996
Consolidated Balance Sheets 3
March 31, 1997 and December 31, 1996
Consolidated Statements of Shareholders' Equity 4
Three months ended March 31, 1997 and
Year ended December 31, 1996
Consolidated Statements of Cash Flows 5
Three months ended March 31, 1997 and 1996
Note to Consolidated Financial Statements 6
SIGNATURES 7
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
SIGNATURE INNS, INC.
CONSOLIDATED STATEMENTS OF OPERATION (UNAUDITED)
- -------------------------------------------------------------------------------------------------
THREE MONTHS ENDED MARCH 31 1997 1996
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Revenues:
Guestroom revenues $ 7,258,768 1,105,371
Other hotel revenues 235,762 31,397
Management and franchise fees 132,084 678,575
--------------- --------------
7,626,614 1,815,343
--------------- --------------
Operating costs and expenses:
Direct hotel expenses 3,978,272 677,084
Depreciation, amortization and retirements 718,510 124,311
Corporate expenses 674,399 616,921
--------------- --------------
5,371,181 1,418,316
--------------- --------------
Operating income 2,255,433 397,027
--------------- --------------
Other income (deductions):
Equity in income (losses) of hotel limited partnerships (72,023) 20,364
Interest income 67,511 53,018
Interest expense (1,197,659) (270,246)
Other partners' equity in income - (53,425)
--------------- --------------
(1,202,171) (250,289)
--------------- --------------
Income before income tax expense 1,053,262 146,738
Provision for income tax expense 372,000 -
--------------- --------------
Net income 681,262 146,738
Preferred stock dividends 744,480 -
--------------- --------------
Net income (loss) applicable to common stock $ (63,218) 146,738
=============== ==============
Earnings (loss) per common share $ (0.03) 0.07
=============== ==============
Weighted average common shares outstanding 2,102,878 2,103,872
=============== ==============
</TABLE>
1
<PAGE> 4
<TABLE>
<CAPTION>
SIGNATURE INNS, INC.
PRO FORMA CONSOLIDATED STATEMENTS OF OPERATION (UNAUDITED)
AMENDED
- -------------------------------------------------------------------------------------------------
PRO FORMA PRO FORMA
THREE MONTHS ENDED MARCH 31 1997 1996
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Revenues:
Guestroom revenues $ 8,558,952 8,380,769
Other hotel revenues 287,800 285,470
--------------- --------------
8,846,752 8,666,239
--------------- --------------
Operating costs and expenses:
Direct hotel expenses 5,056,059 5,417,720
Depreciation, amortization and retirements 861,510 862,488
Corporate expenses 674,399 608,071
--------------- --------------
6,591,968 6,888,279
--------------- --------------
Operating income 2,254,784 1,777,960
--------------- --------------
Other income (deductions):
Equity in income (losses) of hotel limited partnerships (2,179) -
Interest income 67,511 77,301
Interest expense (1,429,654) (1,437,541)
--------------- --------------
(1,364,322) (1,360,240)
--------------- --------------
Income before income tax expense 890,462 417,720
Provision for income tax expense 314,333 136,897
--------------- --------------
Net income 576,129 280,823
Preferred stock dividends 958,800 958,800
--------------- --------------
Net income (loss) applicable to common stock $ (382,671) (677,977)
=============== ==============
Earnings (loss) per common share $ (0.18) (0.32)
=============== ==============
Weighted average common shares outstanding 2,102,878 2,103,872
=============== ==============
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
SIGNATURE INNS, INC.
CONSOLIDATED BALANCE SHEETS
- ---------------------------------------------------------------------------------------------------------
MARCH 31, DECEMBER 31,
1997 1996
- ---------------------------------------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 8,719,324 1,994,751
Restricted cash 918,620 284,292
Other current assets 1,103,428 646,077
--------------- --------------
Total current assets 10,741,372 2,925,120
--------------- --------------
Hotel limited partnership investments 523,821 5,539,457
Property and equipment, net 105,917,803 10,358,333
Furniture and equipment cash reserves 1,556,233 184,708
Deferred costs and other assets, net 698,795 1,603,461
--------------- --------------
$ 119,438,024 20,611,079
=============== ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt 4,710,944 238,765
Other current liabilities 5,344,881 1,324,356
--------------- --------------
Total current liabilities 10,055,825 1,563,121
Long-term debt, less current portion 61,046,628 12,078,622
Other partners' equity - 307,343
--------------- --------------
Total liabilities 71,102,453 13,949,086
--------------- --------------
Shareholders' equity:
Preferred stock, no par value. Authorized 5,000,000 shares. 41,008,583 -
Common stock, no par value. Authorized 13,513,314 shares. 10,001,247 10,017,514
Accumulated deficit (2,674,259) (3,355,521)
--------------- --------------
Total shareholders' equity 48,335,571 6,661,993
--------------- --------------
$ 119,438,024 20,611,079
=============== ==============
</TABLE>
3
<PAGE> 6
<TABLE>
<CAPTION>
SIGNATURE INNS, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Common Stock Preferred Stock
---------------------------- ----------------------------- Accumulated
Shares Amount Shares Amount Deficit Total
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1995 2,103,872 $ 9,805,973 - $ - (5,014,747) 4,791,226
Net income - - - - 1,659,226 1,659,226
Collection of notes receivable - 208,875 - - 208,875
Common shares issued 541 2,666 - - - 2,666
------------- -------------- -------------- -------------- -------------- -------------
BALANCE AT DECEMBER 31, 1996 2,104,413 10,017,514 - - (3,355,521) 6,661,993
Net income - - - - 681,262 681,262
Cash in lieu of fractional shares (2,005) (16,267) - - - (16,267)
Preferred shares issued - - 2,256,000 41,008,583 - 41,008,583
------------- -------------- -------------- -------------- -------------- -------------
BALANCE AT MARCH 31, 1997 2,102,408 $ 10,001,247 2,256,000 $ 41,008,583 (2,674,259) 48,335,571
============= ============== ============== ============== ============== =============
</TABLE>
4
<PAGE> 7
<TABLE>
<CAPTION>
SIGNATURE INNS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
- ----------------------------------------------------------------------------------------------------------
THREE MONTHS ENDED MARCH 31 1997 1996
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 681,262 146,738
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation of property and equipment 693,489 116,695
Amortization of deferred costs 20,000 7,616
Equity in income (losses) of hotel limited partnerships,
net of distributions received of $1,568,364 and $783,761 1,640,387 763,397
Other partners' equity in income - 53,425
Other items (100,219) (172,536)
-------------- -------------
Net cash provided by operating activities 2,934,919 915,335
-------------- -------------
Cash flows from investing activities:
Purchase of hotels from affiliated entities (29,283,605) -
Acquisition and conversion costs of other operating hotels (677,130) -
Property and equipment additions (192,749) (48,784)
Repayments of (advances to) hotel limited partnerships, net 45,369 (40,000)
Deferred acquisition costs and other assets (72,260) (44,450)
-------------- -------------
Net cash used by investing activities (30,180,375) (133,234)
-------------- -------------
Cash flows from financing activities:
Proceeds of long-term debt 10,277,749 -
Repayments of long-term debt (14,550,036) (104,574)
Net repayments on revolving line of credit (2,750,000) (1,000,000)
Cash in lieu of fractional common shares (16,267) -
Issuance of common stock - 208,875
Proceeds from issuance of preferred stock 41,008,583 -
Distributions to other partners by consolidated hotel, net - (228,325)
-------------- -------------
Net cash provided (used) by financing activities 33,970,029 (1,124,024)
-------------- -------------
Net change in cash and cash equivalents 6,724,573 (341,923)
Cash and cash equivalents at beginning of period 1,994,751 2,018,298
-------------- -------------
Cash and cash equivalents at end of period $ 8,719,324 1,676,375
============== =============
Supplemental information:
Interest paid $ 636,000 171,943
Income taxes paid $ 23,000 9,000
Debt assumed to acquire property and equipment $ 60,462,000 -
</TABLE>
5
<PAGE> 8
SIGNATURE INNS, INC.
NOTE TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
March 31, 1997
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information.
Accordingly, the financial statements do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the interim period are not necessarily
indicative of the results that may be expected for the year ended December 31,
1997. For further information, refer to the financial statements included in the
Registrant's annual report on Form 10-KSB for the year ended December 31, 1996.
In January 1997, the Company completed a public offering (the "Offering") of
2,256,000 shares of cumulative convertible preferred stock at $20 per share.
Using a portion of the proceeds of the Offering, other sources of funds and the
assumption of debt, the Company acquired the 23 hotel properties previously
owned by the affiliated partnerships. The unaudited pro forma statements of
operations have been prepared assuming the completion of the Offering and the
acquisition of the 23 hotels owned by the affiliated partnerships. The pro forma
statements of operations assume that these transactions were consummated
immediately prior to the periods presented. The pro forma information is
presented for supplemental disclosure purposes and is not necessarily indicative
of what would have occurred if the Offering and acquisitions had occurred as of
that date. In addition, the pro forma statements do not purport to project the
Company's results of operations for any future period.
6
<PAGE> 9
SIGNATURES
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 thereunto duly authorized.
SIGNATURE INNS, INC.
<TABLE>
<CAPTION>
<S> <C>
Date July 30, 1997 By /s/ John D. Bontreger
------------------ ------------------------------------------
John D. Bontreger, President and C.E.O.
Date July 30, 1997 By /s/ Mark D. Carney
------------------ ------------------------------------------
Mark D. Carney, Vice President Finance and C.F.O.
Date July 30, 1997 By /s/ Martin D. Brew
------------------ ------------------------------------------
Martin D. Brew, Treasurer/Controller
7
</TABLE>
