Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF l934
For the quarterly period ended March 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File No. 1-9762
Resorts International Hotel Financing, Inc.
(Exact name of registrant as specified in its charter)
DELAWARE 65-0461729
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
1133 Boardwalk, Atlantic City, New Jersey 08401
(Address of principal executive offices) (Zip Code)
(609) 344-6000
(Registrant's telephone number,
including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court.
Yes X No
Number of shares outstanding of registrant's common stock as of
March 31, 1994: One. There is no current market for the registrant's
common stock.
Total No. of Pages 9
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RESORTS INTERNATIONAL HOTEL FINANCING, INC.
FORM l0-Q
INDEX
Page Number
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets
at March 31, 1994 and
December 31, 1993 3
Notes to Balance Sheets 4
Item 2. Management's Discussion
and Analysis of Financial
Condition and Results of
Operations 5
Part II. Other Information
Item 6. Exhibits and Reports on
Form 8-K 6
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PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
RESORTS INTERNATIONAL HOTEL FINANCING, INC.
BALANCE SHEETS
March 31, December 31,
1994 1993
(Unaudited)
ASSETS
Due from RII $10 $10
SHAREHOLDER'S EQUITY
Shareholder's equity - Capital in
excess of par $10 $10
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RESORTS INTERNATIONAL HOTEL FINANCING, INC.
NOTES TO BALANCE SHEETS
A. Organization and Operations:
Resorts International Hotel Financing, Inc. ("RIHF") was incorporated
under the laws of the State of Delaware in June 1993 and had no operations
through March 31, 1994. RIHF, a wholly owned subsidiary of Resorts
International, Inc. ("RII"), was organized to issue the public debt
securities described below in connection with a plan of reorganization of
RII. RIHF is authorized to issue 1,000 shares with a par value of $.01 per
share. One share was issued to RII for $10 in October 1993.
B. Issuance of Notes:
RII and GGRI, Inc. ("GGRI"), a subsidiary of RII and the guarantor of
RII's Senior Secured Redeemable Notes which were due April 15, 1994 (the
"Series Notes"), proposed a restructuring (the "Restructuring") of the
Series Notes which was accomplished through a prepackaged bankruptcy plan
of reorganization (the "Plan"). On March 21, 1994, after receiving the
requisite acceptances for confirmation of the Plan from holders of the
Series Notes and equity interests in RII, RII and GGRI filed their
prepackaged bankruptcy cases with the United States Bankruptcy Court for
the District of Delaware (the "Bankruptcy Court"). The Plan was confirmed
by the Bankruptcy Court on April 22, 1994 and on May 3, 1994 (the
"Effective Date") all conditions to the effectiveness of the Plan were
either met or waived and the Plan became effective.
Pursuant to the Plan, the Series Notes were exchanged for, among other
things, $125,000,000 principal amount of 11% mortgage notes (the "Mortgage
Notes") due September 15, 2003 and $35,000,000 principal amount of 11.375%
junior mortgage notes (the "Junior Mortgage Notes") due December 15, 2004.
Hereinafter the Mortgage Notes and the Junior Mortgage Notes, collectively,
are referred to as the "New Debt Securities." The New Debt Securities were
issued by RIHF and guaranteed by Resorts International Hotel, Inc. ("RIH"),
RII's subsidiary that owns and operates Merv Griffin's Resorts Casino Hotel
("Resorts Casino Hotel") in Atlantic City, New Jersey. Also pursuant to the
Plan, RIHF, RIH and RII entered into the senior note purchase agreement
(the "Senior Facility") described below.
The Mortgage Notes are secured by a $125,000,000 promissory note made
by RIH (the "RIH Promissory Note"), the terms of which mirror the terms of
the Mortgage Notes. The RIH Promissory Note and RIH's guaranty of the
Mortgage Notes are secured by liens on the Resorts Casino Hotel, consisting
of RIH's fee and leasehold interests comprising the Resorts Casino Hotel,
the contiguous parking garage and property, all additions and improvements
thereto, and related personal property. The liens securing the Mortgage
Notes will be subordinated to the lien securing the Senior Facility Notes
(described below), if the Senior Facility Notes are issued.
The Junior Mortgage Notes are secured by a $35,000,000 promissory note
made by RIH (the "RIH Junior Promissory Note"), the terms of which mirror
the terms of the Junior Mortgage Notes. The RIH Junior Promissory Note and
RIH's guaranty of the Junior Mortgage Notes are also secured by liens on
the Resorts Casino Hotel property as described above. The liens securing
the Junior Mortgage Notes will be subordinated to the lien securing the
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Senior Facility Notes, if the Senior Facility Notes are issued, and are
subordinated to the liens securing the Mortgage Notes.
The indentures pursuant to which the Mortgage Notes and the Junior
Mortgage Notes were issued (collectively, the "Indentures") prohibit RIHF
from paying dividends, from making other distributions in respect of its
capital stock, and from purchasing or redeeming its capital stock, with
certain exceptions.
The Indentures also contain certain other restrictive covenants on the
part of RIHF, including (i) limitations on incurring additional
indebtedness, with certain exceptions; (ii) restrictions on making loans to
an affiliate or other person other than (x) intercompany advances to RII
not in excess of $1,000,000 in the aggregate at any time outstanding and
(y) indebtedness evidenced by the RIH Senior Facility Promissory Note
(defined below), the RIH Promissory Note and the RIH Junior Promissory
Note; and (iii) restrictions from entering into transactions with
affiliates, other than transactions entered into in connection with the
Senior Facility, on terms less favorable to RIHF than an arm's length
transaction.
The Senior Facility among RIHF, RII and RIH and certain funds and
accounts advised or managed by Fidelity Management & Research Company
("Fidelity"), is available for a single borrowing of up to $20,000,000
during the one-year period following the Effective Date, through the
issuance of notes (the "Senior Facility Notes"). If issued, the Senior
Facility Notes will bear interest at 11% and will be due in 2002. The
Senior Facility Notes will be senior obligations of RIHF secured by a
promissory note from RIH (the "RIH Senior Facility Promissory Note") in an
aggregate principal amount of up to $20,000,000 payable in amounts and at
times necessary to pay the principal of and interest on the Senior Facility
Notes. The Senior Facility Notes will be guaranteed by RIH and secured by
a lien on the Resorts Casino Hotel property as described above. The Senior
Facility Notes will also be secured by a pledge by GGRI of all issued and
outstanding shares of RIH common stock. In addition, the Senior Facility
Notes will be guaranteed by RII, which guaranty will be secured by a pledge
of all the issued and outstanding stock of GGRI and RIHF.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
FINANCIAL CONDITION
RIHF was formed for the purpose of issuing the Mortgage Notes and the
Junior Mortgage Notes as part of the Restructuring, as well as the Senior
Facility Notes to the extent issued. Also as part of the Restructuring,
RIHF obtained the RIH Promissory Note and the RIH Junior Promissory Note
with terms that mirror the terms of the Mortgage Notes and the Junior
Mortgage Notes with the intent that RIH pay interest to RIHF on RIHF's
interest payment dates so that RIHF will have cash available to make its
interest payments on those dates.
RESULTS OF OPERATIONS
RIHF had no operations through the first quarter of 1994. Subsequent
to the Restructuring it is expected that RIHF will have affiliated interest
income equal to the interest expense on its public debt. It is not
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anticipated that RIHF will have any other operations or activities, except
those related to the New Debt Securities and, if issued, the Senior
Facility Notes or certain similar financing activities.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
The following exhibits are incorporated by reference:
Exhibit
Numbers Exhibits
2.01 Plan of Reorganization. (Incorporated by reference to
Appendix A of the Information Statement/Prospectus included in
Form S-4 Registration Statement No. 33-50733.)
4.01-4.03 Not used.
4.04 Form of Indenture among RIHF, as issuer, RIH, as guarantor,
and State Street Bank and Trust Company of Connecticut,
National Association, as trustee, with respect to RIHF 11%
Mortgage Notes due 2003.*
4.05 Form of Indenture between RIHF, as issuer, RIH, as guarantor,
and U.S. Trust Company of California, N.A., as trustee, with
respect to RIHF 11.375% Junior Mortgage Notes due 2004.*
4.06-4.21 Not used.
4.22 Form of Mortgage between RIH and State Street Bank and Trust
Company of Connecticut, National Association, securing
Guaranty of RIHF Mortgage Notes.*
4.23 Form of Mortgage between RIH and RIHF, securing RIH Promissory
Note.*
4.24 Form of Assignment of Agreements made by RIHF, as Assignor, to
State Street Bank and Trust Company of Connecticut, National
Association, as Assignee, regarding RIH Promissory Note.*
4.25 Form of Assignment of Leases and Rents made by RIH, as
Assignor, to RIHF, as Assignee, regarding RIH Promissory
Note.*
4.26 Form of Assignment of Leases and Rents made by RIH, as
Assignor, to State Street Bank and Trust Company of
Connecticut, National Association, as Assignee, regarding
Guaranty of RIHF Mortgage Notes.*
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4.27 Form of Assignment of Operating Assets made by RIH, as
Assignor, to RIHF, as Assignee, regarding RIH Junior
Promissory Note.*
4.28 Form of Assignment of Operating Assets made by RIH, as
Assignor, to State Street Bank and Trust Company of
Connecticut, National Association, as Assignee, regarding
Guaranty of RIHF Mortgage Notes.*
4.29 Form of Mortgage between RIH and U.S. Trust Company of
California, N.A., securing Guaranty of RIHF Junior Mortgage
Notes.*
4.30 Form of Mortgage between RIH and RIHF, securing RIH Junior
Promissory Note.*
4.31 Form of Assignment of Agreements made by RIHF, as Assignor, to
U.S. Trust Company of California, N.A., as Assignee, regarding
RIH Junior Promissory Note.*
4.32 Form of Assignment of Leases and Rents made by RIH, as
Assignor, to RIHF, as Assignee, regarding RIH Junior
Promissory Note.*
4.33 Form of Assignment of Leases and Rents made by RIH, as
Assignor, to U.S. Trust Company of California, N.A., as
Assignee, regarding Guaranty of RIHF Junior Mortgage Notes.*
4.34 Form of Assignment of Operating Assets made by RIH, as
Assignor, to RIHF, as Assignee, regarding RIH Promissory
Note.*
4.35 Form of Assignment of Operating Assets made by RIH, as
Assignor, to U.S. Trust Company of California, N.A., as
Assignee, regarding the Guaranty of the RIHF Junior Mortgage
Notes.*
4.36 Form of Amended and Restated $125,000,000 RIH Promissory Note
(Incorporated by reference to Exhibit A to Exhibit 4.04
hereto.)
4.37 Form of Amended and Restated $35,000,000 RIH Junior Promissory
Note (Incorporated by reference to Exhibit A to Exhibit 4.05
hereto.)
10.01-10.63 Not Used.
10.64 Form of Intercreditor Agreement by and among RIHF, RIH, RII,
GGRI, State Street Bank and Trust Company of Connecticut,
National Association, U.S. Trust Company of California, N.A.
and any lenders which provide additional facilities.*
10.65 Form of Note Purchase Agreement dated May 3, 1994, among RIHF,
RII and RIH, and certain funds advised or managed by Fidelity
with respect to issuance of Senior Facility Notes.
(Incorporated by reference to Exhibit 10.65 in Form S-1
Registration Statement No. 33-53371.)
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10.66 Form of Registration Rights Agreement dated as of April 29,
1994, among RII, RIHF, RIH, Fidelity and TCW. (Incorporated
by reference to Exhibit 10.66 in Form S-1 Registration
Statement No. 33-53371.)
______________________
*Incorporated by reference to the same exhibit number in Form S-4
Registration Statement No. 33-50733.
b. Reports on Form 8-K
No Current Report on Form 8-K was filed by RIHF covering an event
during the first quarter of 1994.
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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.
RESORTS INTERNATIONAL HOTEL FINANCING, INC.
(Registrant)
/s/ Matthew B. Kearney
Matthew B. Kearney
Executive Vice
President - Finance
(Authorized Officer of
Registrant and Chief
Financial Officer)
Date: May 12, 1994
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