<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] Annual report pursuant to Section 13 or 15 (d) of The Securities Exchange
Act of 1934 (Fee required of $250.)
For the fiscal year ended: December 31, 1995 Commission File Number: 0-16840
PSH MASTER L.P. I
(Exact Name of Registrant as Specified in its Charter)
Delaware 31-1204568
(State of Organization) (IRS Employer Identification Number)
P.O. Box 18035, Columbus, OH 43218
(Address of Principal Executive Offices, including Zip Code)
(614) 227-4235
(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.
X Yes No
------- --------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the Registrant's outstanding Units of Limited
Partner Interest held by non-affiliates on March 29, 1996, based upon the
average bid and ask prices as reported by the National Association of Securities
Dealers OTC Bulletin Board on that date, was $1,943,750.
DOCUMENTS INCORPORATED BY REFERENCE
None
<PAGE> 2
PART I
ITEM 1. BUSINESS.
BUSINESS OF THE REGISTRANT
PSH Master L.P. I (the Partnership) is a Delaware limited partnership formed in
1987 for the purpose of acquiring from PC Development Limited Partnership (the
General Partner) three all-suite hotels located in Tampa, Florida, WALT DISNEY
WORLD(R) Village in Lake Buena Vista, Florida and in the Research Triangle area
near Raleigh/Durham, North Carolina. The Partnership's business is the operation
of its all-suite hotels. The hotels have been developed to cater to commercial
travelers and small business groups, as well as individuals and families
traveling for pleasure. Each hotel is designed to have the ambiance of a
first-class hotel, with prices in the upper-middle market range. The principal
focus of each hotel is on comfort and convenience for the individual guest,
rather than on such common amenities as specialty restaurants, entertainment
lounges, and ballrooms. The three hotels include a total of 635 suites, most of
which approximate 625 square feet. Each suite contains a working-living area
suitable for small business meetings, a large separate bedroom and a separate
dressing-bathing area and is equipped with a stocked, built-in refrigerator and
a wet bar. The working-living area is furnished with a dining-conference table,
a desk, a sleeper sofa and a large easy chair. Each suite also has three
television sets, located in the living area, bedroom and bathroom. The
Partnership's hotels are operated as Doubletree Guest Suites.
OPERATION OF THE HOTELS AND CONVERSION TO DOUBLETREE GUEST SUITES
The Partnership is a party to a Management Agreement with Doubletree Hotels
Corporation (Doubletree), to operate and manage the hotels. The Management
Agreement expires on December 29, 2011 with two consecutive ten year renewal
options.
Doubletree is a national hotel chain which was formed by the December, 1993
merger of two regional hotel brands: Guest Quarters Suite Hotels and Doubletree
Hotels. In February, 1995 the two regional brands united to become one national
brand known as Doubletree. Doubletree currently operates 115 properties with
more than 30,000 rooms. They are the fifth largest U.S. lodging chain operating
under one brand name in the upscale market segment. The Doubletree portfolio
consists of the following three company brands:
DOUBLETREE HOTELS are full service, first class, 4-star, all-suite hotels
geographically located in primary markets through the United States. They
compete against all major first class brands including Marriott, Hyatt,
Sheraton, Embassy, Hilton and Wyndham.
DOUBLETREE GUEST SUITES are full service, first class, 4-star, all-suite hotels
geographically located in primary markets throughout the United States.
Doubletree Guest Suites compete against all major first class brands, and
particularly all-suite brands including Embassy Suites, Marriott Suites and
Sheraton Suites.
2
<PAGE> 3
CLUB HOTELS BY DOUBLETREE are limited service, 3-star, mid-scale hotels
geographically located in secondary and tertiary markets throughout the United
States. Club Hotels compete against all major mid-scale brands including
Radisson, Holiday Inn, Ramada, Courtyard by Marriott, and Four Points by ITT
Sheraton.
Pursuant to the Management Agreement, Doubletree operates each hotel in such a
manner as is customary and usual in the operation of first-class hotels, and
Doubletree provides to each hotel the same services it provides to other hotels
managed by it. Management services provided by Doubletree include, without
limitation, supervision of the day-to-day operations, determination and
implementation of programs and policies for hotel operations, preparation of
budgets and reports, maintenance of each hotel's books and records, negotiation
of leases and other agreements on behalf of the Partnership, maintenance of
hotel furniture and equipment (to the extent funds are available for that
purpose) and coordination of hotel marketing and advertising. The Partnership
has no employees. All hotel personnel, including the general manager for each
hotel, are employed by Doubletree.
The Hotels are included in regional and national advertising placed by
Doubletree. Each hotel's staff includes sales people who promote the hotel in
the local market for both individual reservations and group meetings and
national direct sales people who solicit business from major travel agencies and
corporate travel departments in major cities throughout the United States. Prior
to 1995, Doubletree assessed the hotels up to three and one-half percent of
total revenues for national advertising and central reservations. During 1995,
Doubletree assessed the hotels four percent of total room sales for centralized
reservation services and national advertising expenses. This change resulted
from the Guest Quarters hotels being integrated into the Doubletree central
reservation system. Beginning in 1996, Doubletree will assess the hotels up to
three and one-half percent of total room sales for national advertising and
central reservation expenses.
All Doubletree hotels, including the Partnership's hotels, are included in a
nationwide, toll-free reservation system. In addition, the Disney hotel is
included in the Disney reservation system. Travelers who call Walt Disney
World(R) for recommendations on accommodations are referred to Walt Disney
World(R) Hotels and then to other hotels within the Disney complex, on a
rotating basis, including the Partnership's Disney hotel.
HOSPITALITY INDUSTRY AND ALL-SUITE HOTELS
An all-suite hotel is a lodging facility that caters to transient guests and
guests visiting the facility to conduct small group meetings. It is
distinguished from traditional hotels in that all of its guest rooms are suites
of two or more rooms, with physically separate functional areas for sleeping,
bathing, dressing, dining, meeting and lounging. Most all-suite facilities have
small common areas and limited or no food service facilities. The business goal
of all-suite hotels is to create a superior price/value relationship for the
traveler compared with traditional hotels featuring rooms in the same price
category, while achieving a higher gross operating profit margin.
3
<PAGE> 4
COMPETITION AND SEASONALITY
Each hotel experiences significant competition in its market from other hotels,
some of which are affiliated with national and regional chains with greater
financial and other resources than the Partnership or the General Partner. The
hotels compete by offering first-class accommodations at prices in the
upper-middle market range.
The hotels' occupancies are seasonal by nature. The occupancy of the Disney
hotel has been strongest from late February through August. The Tampa Hotel
caters primarily to business travelers and has experienced its highest occupancy
during January through May and October and November. The Durham hotel has
recorded its highest occupancies from February through June and from August
through November.
Of the three markets in which the Partnership's hotels compete, the Disney
market has been the most competitive in terms of increases in the supply of
hotel rooms. The Walt Disney organization has followed a very aggressive growth
strategy in the development of new hotels within the Disney parks and plans to
continue this pattern into the future. In addition to the hotels developed by
the Walt Disney organization, numerous other hotels have been opened or are in
development. Nearly 5,000 hotel rooms are expected to open in 1996 in or around
the Walt Disney World grounds. These supply additions are expected to place
increased pressure on revenues and profits at the Partnership's Disney hotel.
Supply has been negligible in recent years, although some development activity
has been announced or is under way in the Tampa and Raleigh/Durham markets. In
Tampa, city council recently announced its support for the development of a
Sheraton hotel near the downtown convention center. Due to its downtown
location, development is not expected to have a significant impact on the
Partnership's hotel. Announcements of numerous plans for new hotels in the
Raleigh/Durham area, primarily in the limited service category, were made in
1995. It is unclear at this time which of these will become reality. The opening
of two limited service hotels is expected in 1996 and, based upon the relative
health of the hotel market, additional new supply is likely in 1997 and beyond.
ITEM 2. PROPERTIES.
The Tampa hotel is situated on Rocky Point Harbor in the Rocky Point development
in the West Shore area of Tampa, Florida. The Disney hotel is located within the
boundaries of the WALT DISNEY WORLD(R) Village. The Durham hotel is in the
Research Triangle near Raleigh/Durham, North Carolina. The Tampa and Durham
hotels each contain 203 suites and the Disney hotel has 229 suites. The Tampa
hotel opened in April, 1986 and the Disney and Durham hotels opened in March and
December of 1987, respectively.
The Partnership owns the Tampa and Durham hotels in fee title. The Disney hotel
is subject to a ground lease from Lake Buena Vista Communities, Inc. The initial
term of the lease expires on March 11, 2032 with a renewal option for an
additional period of 25 years. The hotels are subject to first mortgage notes.
For a further description of the terms of the Disney ground lease and the
mortgage notes, see the Notes 6 and 7 to the Financial Statements included in
Item 8. Financial Statements and Supplementary Data.
4
<PAGE> 5
ITEM 3. LEGAL PROCEEDINGS.
The Registrant was not a party to any material pending legal proceedings as of
March 29, 1996.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF UNITHOLDERS.
The Registrant submitted no matters to a vote of Unitholders during the fiscal
year ended December 31, 1995.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S UNITS OF LIMITED PARTNER INTEREST AND
DEPOSITORY RECEIPTS THEREFOR AND RELATED UNITHOLDER MATTERS.
a) MARKET INFORMATION
The Registrant's units of limited partner interest and depository
receipts therefor (the "Units") were previously listed in the
Quotations List of the National Association of Securities Dealers, Inc.
(NASD) under the symbol PSHPZ. The Partnership was removed from the
automated quotation system of the NASD on December 18, 1991 as a result
of its failure to meet the capital and surplus requirements of the
NASD. The Partnership's units are now traded through the NASD's "OTC
Bulletin Board", an electronic, screened-based market.
The following table summarizes the high and low bid information for the
Registrant's Units information as reported on the OTC Bulletin Board.
<TABLE>
<CAPTION>
HIGH BID LOW BID
-------- -------
<S> <C> <C>
1993
1st Quarter ended March 31 1/2 1/4
2nd Quarter ended June 30 1/2 1/4
3rd Quarter ended September 30 1/2 1/4
4th Quarter ended December 31 1/2 1/4
1994
1st Quarter ended March 31 1/2 1/4
2nd Quarter ended June 30 1/2 1/4
3rd Quarter ended September 30 1/2 1/4
4th Quarter ended December 31 1/2 1/4
1995
1st Quarter ended March 31 1/2 1/4
2nd Quarter ended June 30 3/4 1/4
3rd Quarter ended September 30 3/4 1/4
4th Quarter ended December 31 7/8 3/8
</TABLE>
The above bid quotations do not necessarily represent actual
transactions as they may reflect inter-dealer prices, without retail
mark-up, mark-down or commission.
5
<PAGE> 6
(B) HOLDERS
On December 31, 1995, there were 2,559 holders of record of the
Registrant's Units.
(C) DISTRIBUTIONS
The General Partner had previously guaranteed that the Partnership
would make annual cash distributions to Unitholders through 1990 in the
amount of $1.10 per unit. The General Partner did not make the cash
payments to the Partnership to fund the cash distributions for the
third and fourth quarters of 1990, and no subsequent cash distributions
have been made (see Note 10 to Item 8. Financial Statements and
Supplementary Data).
ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
OPERATIONS:
<S> <C> <C> <C>
Operating revenues $ 21,887,229 $ 20,782,668 $ 19,799,331
Total Revenues $ 21,905,694 $ 20,805,044 $ 19,828,011
Income from operations before
depreciation and amortization
expense $ 5,957,687 $ 5,546,805 $ 4,146,379
Net loss $ (770,442) $ (1,073,093) $ (2,233,357)
Net loss to Limited Partners $ (762,738) $ (1,062,362) $ (2,211,023)
Cash distributions to
Limited Partners $ -0- $ -0- $ -0-
FINANCIAL POSITION:
Property and equipment, net $ 36,177,566 $ 36,959,885 $ 37,720,719
Total assets $ 39,675,237 $ 40,802,523 $ 41,491,644
Long-term obligations (excluding
current maturities) $ 46,028,387 $ 46,403,119 $ 46,171,876
Total partners' deficit $ (9,014,121) $ (8,243,679) $ (7,170,586)
Limited partners' deficit $ (8,746,712) $ (7,983,974) $ (6,921,612)
PER UNIT:
Cash distributions to Limited
Partners $ -0- $ -0- $ -0-
Net loss to Limited Partners $ (0.25) $ (0.34) $ (0.71)
Limited Partners' equity (deficit) $ (2.81) $ (2.57) $ (2.23)
Total units outstanding 3,110,000 3,110,000 3,110,000
</TABLE>
6
<PAGE> 7
ITEM 6. SELECTED FINANCIAL DATA (CONTINUED)
<TABLE>
<CAPTION>
1992 1991
---- ----
<S> <C> <C>
OPERATIONS:
Operating revenues $ 19,112,677 $ 18,209,166
Total Revenues $ 19,144,195 $ 18,278,938
Income from operations before
depreciation and amortization
expense $ 3,935,648 $ 2,740,148
Net loss $ (3,719,660) $ (4,917,404)
Net loss to Limited Partners $ (3,682,463) $ (4,868,230)
Cash distributions to
Limited Partners $ -0- $ -0-
FINANCIAL POSITION:
Property and equipment, net $ 38,763,416 $ 41,728,584
Total assets $ 42,489,594 $ 46,289,162
Long-term obligations (excluding $41,300,000 (1) $41,300,000 (1)
current maturities)
Total partners' equity (deficit) $ (4,937,229) $ (1,217,569)
Limited partners' equity (deficit) $ (4,710,589) $ (1,028,126)
PER UNIT:
Cash distributions to Limited
Partners $ -0- $ -0-
Net loss to Limited Partners $ (1.18) $ (1.57)
Limited Partners' equity (deficit) $ (1.51) $ .33
Total units outstanding 3,110,000 3,110,000
</TABLE>
(1) Includes $41,300,000 at December 31, 1992 and 1991 classified as current due
to mortgage notes being in default.
7
<PAGE> 8
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
LIQUIDITY AND CAPITAL RESOURCES
The Partnership has incurred net losses since its inception and has not paid
cash to the Partnership to cover these shortfalls in full pursuant to the
Performance and Break-even Guaranty. The final payment on the Partnership's real
estate mortgage notes due on August 1, 1997 (see Note 7 to the financial
statements), the Partners' accumulated deficits and the uncertainty of the
Partnership's ability to refinance the first mortgage debt on maturity (see Page
9), raise substantial doubt about the Partnership's ability to continue as a
going concern for a reasonable period of time. Accordingly, the opinion the
Partnership has received from its independent auditors included a going concern
qualification. However, as disclosed in the auditors' report, the financial
statements do not include any adjustments relating to the recoverability and
classification of recorded asset or liability amounts that might be necessary
should the Partnership be unable to continue as a going concern.
In 1995 and 1994, the Partnership made monthly payments of principal and
interest on the outstanding principal of $46,395,267 based upon a 30-year
amortization schedule at the contract rate of 10.25%, in accordance with the
restructured loans. Cash from operations, after required replacement reserves,
exceeded the required debt service by $460,426 and $77,093, respectively. These
excess amounts have served to significantly improve the Partnership's working
capital and current ratio positions. The Partnership's liquidity is supplemented
by the loan commitment of Doubletree, up to $1,000,000, to fund cash deficits in
the event the properties cannot meet the revised loan terms. No amounts have
been borrowed under such agreement at December 31, 1995.
Hotel operations are the Partnership's primary and on-going source of cash to
pay its operating expenses, to meet its reserve requirements and to make cash
distributions to its partners. Hotel occupancy is seasonal by nature. Cash flows
track this seasonality closely due to the nature of trade receivables. Other
trade receivables include wholesale and travel agent accounts, and corporate and
group billings, the majority of which are collected within 30 days. The
Partnership earns interest income from its various operating cash accounts
including the balances held in the Replacement Reserve Funds.
In addition to its hotel operations, the Partnership will receive annual
payments in 1996 and 1997 on its unsecured claim against the General Partner,
which in 1991 filed for protection against its creditors under Chapter 11 of the
U.S. Bankruptcy Code. The Partnership expects to receive total payments of
approximately $1,000,000, including $710,335 received through 1995, in
satisfaction of its claim.
The Partnership is required by its Management Agreement to maintain Replacement
Reserve Fund balances of specified amounts to facilitate operating the Hotels as
"first-class" suite accommodations. Separate Replacement Reserve Funds have been
established for replacements, substitutions and additions to furniture and
equipment and must be funded each accounting period.
8
<PAGE> 9
The Partnership's mortgage obligations mature on August 1, 1997, requiring a
balloon payment of approximately $45,500,000. In addition, the lender will
receive 25% of the net proceeds, as defined, at sale of the hotels, or net
proceeds based upon market value if the hotels are not sold prior to the
maturity of the loan, as appreciation interest. Given the underwriting standards
of first mortgage lenders with respect to loan to value ratios and debt service
coverage ratios, it is unlikely that the Partnership can refinance, in total,
its present debt with a new first mortgage lender. The General Partner has begun
to explore the various alternatives which may be available to the Partnership.
These alternatives include further renegotiations with the current lender, an
infusion of equity into the Partnership, securing subordinated debt or the sale
of one or more of the hotels. For some of these alternatives, the General
Partner may be required to seek the approval of the Limited Partners in
accordance with the Partnership Agreement.
RESULTS OF OPERATIONS
The Tampa and Disney hotels opened in April, 1986 and March, 1987, respectively,
and the Durham hotel opened in December, 1987. The following table summarizes
combined operating information for the hotels:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Total suites 635 635 635
Available suites per year 231,775 231,775 231,775
Occupancy percentage 75.3% 73.8% 72.9%
Average daily rate $ 96.86 $ 94.40 $ 91.47
Direct operating costs as a
percent of total revenues 33.0% 32.4% 35.5%
Income (Loss) before depreciation
and amortization expense $1,206,971 $815,696 $(516,253)
Income (Loss) before depreciation
and amortization expense per unit
of limited partnership interest $.39 $.26 $(.17)
</TABLE>
Tracking the macro trends of the hospitality industry, the Partnership's hotels
have achieved significant revenue gains during the last three years, driven by
improvements in occupancy and average daily rate and in food and beverage sales
volumes. Year-over-year increases in total revenues were 3.6%, 5.0%, and 5.3%
during the years 1993 through 1995. These revenue gains resulted in profit
improvements which allowed the Partnership to meet the required payments of its
restructured debt obligations in the three year period. Excluding depreciation
and amortization charges, total operating costs decreased 5% from 1992 to 1995,
reflecting a general trend of improved cost control by Doubletree since 1992.
9
<PAGE> 10
1995 compared to 1994
Year to date, revenues increased 5.3% from 1994, based upon a 2.6% increase in
average daily rate and a 2.1% increase in occupancy. Average daily rate
increases were achieved at the Tampa and Raleigh/Durham hotels while the Disney
hotel experienced a slight rate decline. Occupancy remained strong for all three
properties, increasing 2.1% from one year earlier. Food, beverage and other
revenues increased 7.1% from 1994, based upon higher volumes and price
increases.
Direct operating expenses increased as a percent of revenues, compared to 1994,
reflecting higher labor-related costs in the current year. Energy and
maintenance expense was higher in 1995 due to extreme weather in Florida during
1995 which resulted in higher costs. Rents, taxes and other expenses declined
due to cost reductions in real estate taxes from lower assessed values achieved
at the properties.
Partnership administrative expenses consist primarily of quarterly and annual
report costs, tax processing and transfer agent charges and legal and audit
fees. Depreciation and amortization expense increased 4.7% in 1995 due to the
fixed asset additions in 1995 now being depreciated.
1994 compared to 1993
Year to date, revenues increased 4.7% from 1993, based upon a 3.2% increase in
average daily rate and a 1.2% increase in occupancy. Average daily rate
increased at each hotel while volume gains in Disney and Raleigh/Durham were
offset by lower occupancy at Tampa. Food, beverage and other revenues increased
6% from 1993, based upon higher volumes and price increases.
Direct operating expenses decreased as a percent of revenues, compared to 1993,
reflecting lower labor-related costs in the current year. Energy and maintenance
expense was lower in 1994 due to extreme weather and storm damage at the Tampa
hotel which resulted in higher costs in 1993. Rents, taxes and other expenses
declined primarily because of cost reductions in providing transportation to the
Disney hotel. Bus transportation to and from the Walt Disney World(R)
attractions was previously provided by Walt Disney World(R). This contract was
canceled in mid-1993 and bus transportation is now being provided by a new
carrier which services five of the seven Disney Village hotels.
Partnership administrative expenses consist primarily of quarterly and annual
report costs, tax processing and transfer agent charges and legal and audit
fees. Depreciation and amortization expense increased 9% in 1994 due to the
fixed asset additions in 1994 now being depreciated.
10
<PAGE> 11
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
PSH MASTER L.P. I
INDEX
Page
Number
------
Balance Sheets 12
Statements of Operations 14
Statements of Partners' Deficit 15
Statements of Cash Flows 16
Notes to the Financial Statements 17
Independent Auditors' Report 24
11
<PAGE> 12
PSH MASTER L.P.I
BALANCE SHEETS
<TABLE>
<CAPTION>
Assets December 31, 1995 December 31, 1994
- - ------ ----------------- -----------------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 579,253 $ 305,132
Accounts receivable, trade 986,029 1,062,885
Inventories 103,444 117,215
Prepaid expenses and other 335,179 174,864
Cash held in escrow 346,089 187,139
------------ ------------
Total current assets 2,349,994 1,847,235
------------ ------------
Property and equipment:
Land 3,780,000 3,780,000
Leasehold interest in land 7,440,000 7,440,000
Hotels 36,191,902 35,889,676
Furniture, fixtures and equipment 11,104,168 10,401,259
------------ ------------
Total 58,516,070 57,510,935
Less accumulated depreciation and amortization (22,338,504) (20,551,050)
------------ ------------
Total property and equipment, net 36,177,566 36,959,885
------------ ------------
Other assets:
Replacement reserve fund 46,524 704,290
China, glass, linen and silver 781,590 781,590
Deferred financing fees, organization costs
and other, net 319,563 509,523
------------ ------------
Total other assets 1,147,677 1,995,403
------------ ------------
Total assets $ 39,675,237 $ 40,802,523
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
12
<PAGE> 13
PSH MASTER L.P.I
BALANCE SHEETS
<TABLE>
<CAPTION>
Liabilities and Partners' Deficit December 31, 1995 December 31, 1994
- - --------------------------------- ----------------- -----------------
<S> <C> <C>
Current liabilities:
Current portion of mortgage notes payable $ 273,979 $ 268,759
Accounts payable 1,739,648 1,360,583
Due to affiliates 37,442 38,169
Accrued expenses:
Payroll and related taxes 342,265 363,155
Real estate and other taxes 95,671 113,952
Interest 0 403,639
Other 171,966 94,826
------------ ------------
Total current liabilities 2,660,971 2,643,083
------------ ------------
Note payable 500,000 500,000
Mortgage notes payable, less current portion 45,528,387 45,903,119
Partners' Deficit:
General Partner (267,409) (259,705)
Limited Partners (3,110,000 units outstanding) (8,746,712) (7,983,974)
------------ ------------
Total partners' deficit (9,014,121) (8,243,679)
------------ ------------
Total liabilities and partners' deficit $ 39,675,237 $ 40,802,523
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
13
<PAGE> 14
PSH MASTER L.P.I
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Year ended Year ended Year ended
December 31, 1995 December 31, 1994 December 31, 1993
----------------- ----------------- -----------------
<S> <C> <C> <C>
Revenues:
Suites $ 16,917,194 $ 16,141,594 $ 15,451,460
Other 4,970,035 4,641,074 4,347,871
------------ ------------ ------------
Total revenues 21,887,229 20,782,668 19,799,331
------------ ------------ ------------
Operating costs and expenses:
Direct operating:
Suites 3,686,203 3,356,235 3,597,959
Other 3,534,968 3,367,423 3,421,967
Other operating:
Sales, general and administrative 4,743,202 4,536,546 4,471,359
Energy and maintenance 1,995,534 1,910,640 1,956,462
Rents, taxes and other 1,809,115 1,920,839 1,964,607
Partnership administrative 160,520 144,180 240,598
Depreciation and amortization 1,977,413 1,888,789 1,717,104
------------ ------------ ------------
Total operating costs and expenses 17,906,955 17,124,652 17,370,056
------------ ------------ ------------
Income from operations 3,980,274 3,658,016 2,429,275
Interest income 18,465 22,376 28,680
Interest expense 4,769,181 4,753,485 4,691,312
------------ ------------ ------------
Net loss $ (770,442) $ (1,073,093) $ (2,233,357)
============ ============ ============
Net loss per unit of
limited partnership interest $ (0.25) $ (0.34) $ (0.71)
============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
14
<PAGE> 15
PSH MASTER L.P.I
STATEMENTS OF PARTNERS' DEFICIT
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
--------- ----------- -----------
<S> <C> <C> <C>
Deficit balance, December 31, 1992 (226,640) (4,710,589) (4,937,229)
Net loss (22,334) (2,211,023) (2,233,357)
--------- ----------- -----------
Deficit balance, December 31, 1993 (248,974) (6,921,612) (7,170,586)
Net loss (10,731) (1,062,362) (1,073,093)
--------- ----------- -----------
Deficit balance, December 31, 1994 (259,705) (7,983,974) (8,243,679)
Net loss (7,704) (762,738) (770,442)
--------- ----------- -----------
Deficit balance, December 31, 1995 $(267,409) $(8,746,712) $(9,014,121)
========= =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
15
<PAGE> 16
PSH MASTER L.P.I
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Year ended Year ended Year ended
December 31, 1995 December 31, 1994 December 31, 1993
----------------- ----------------- -----------------
<S> <C> <C> <C>
Cash provided (used) by operations:
Net loss $ (770,442) $(1,073,093) $(2,233,357)
Changes not requiring cash:
Depreciation and amortization 1,977,413 1,888,789 1,717,104
Interest capitalized into mortgage notes 974,312
Working capital changes:
(Increase) decrease in accounts
receivable, trade 76,856 (249,664) 71,851
(Increase) decrease in inventories,
prepaid expenses and other (146,544) (46,272) 111,461
Increase in accounts payable
and accrued expenses 417,034 9,980 121,120
Increase (decrease) in accrued
interest payable (403,639) 93,889 (79,889)
Increase (decrease) in due to
affiliates (727) 3,492 864
----------- ----------- -----------
Cash provided by operations 1,149,951 627,121 683,466
----------- ----------- -----------
Financing and capital transactions:
Guaranty payments from General
Partner 41,589 53,475 111,405
Proceeds from notes payable 500,000 219,000
Increase in deferred financing cost (308,872)
Payments of mortgages (369,512) (223,389)
----------- ----------- -----------
Cash provided (used) by financing
and capital transactions (327,923) 330,086 21,533
----------- ----------- -----------
Investment and other transactions:
(Increase) decrease in
replacement reserve fund 657,766 (331,199) 58,954
Increase in china, glass,linen,
and silver, net (1,866)
(Increase) decrease in cash escrow
for real estate taxes (158,950) 13,141 (110,710)
Additions to property and
equipment, net (1,046,723) (991,477) (625,792)
----------- ----------- -----------
Cash used by investment and
other transactions (547,907) (1,311,401) (677,548)
----------- ----------- -----------
Increase (decrease) in cash and
cash equivalents $ 274,121 $ (354,194) $ 27,451
=========== =========== ===========
Supplemental disclosure of cash flow
information-cash paid for interest $ 5,172,820 $ 4,659,596 $ 3,796,889
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
16
<PAGE> 17
NOTES TO THE FINANCIAL STATEMENTS
(1) BASIS OF PRESENTATION
The accompanying financial statements of PSH Master L.P. I (the Partnership)
have been prepared on a going concern basis which contemplates the realization
of assets and the satisfaction of liabilities in the normal course of business.
The Partnership has incurred net losses since its inception, including 1995 -
$770,442; 1994 - $1,073,093 and 1993 - $2,233,357 and at December 31, 1995, the
Partnership had a partners' deficit of $9,014,121.
The final payment on the Partnership's real estate mortgage notes due on August
1, 1997 (see Note 7), the accumulated Partners' deficits and the uncertainty of
the Partnership's ability to refinance the first mortgage debt on maturity,
raise substantial doubt about the Partnership's ability to continue as a going
concern for a reasonable period of time. The financial statements do not include
any adjustments relating to the recoverability and classification of recorded
asset amounts or the amounts and classification of liabilities that might be
necessary should the Partnership be unable to continue as a going concern. The
General Partner has begun to explore the various alternatives which may be
available to the Partnership. These alternatives include further renegotiations
with the current lender, an infusion of equity into the Partnership, securing
subordinated debt or the sale of one or more of the hotels. For some of these
alternatives, the General Partner may be required to seek the approval of the
Limited Partners in accordance with the Partnership Agreement.
(2) BANKRUPTCY OF GENERAL PARTNER
On February 1, 1991, PC Development Limited Partnership, the General Partner,
along with one of its general partners and two affiliated corporations, filed
for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code. On
December 30, 1991, the debtors filed a Joint Plan of Reorganization and
Disclosure Statement and, on April 19, 1992, the court confirmed the Plan.
An unsecured claim in the amount of $5,038,658 was filed in the bankruptcy case
on behalf of the Partnership due to the General Partner's default under the
Performance and Break-even Guaranty (the Guaranty Agreement). Total payments
received to date by the Partnership against its unsecured claim total $710,335.
The debtors estimate that approximately $1,000,000, including the previous
payments, will be paid to the Partnership in satisfaction of the Partnership's
claim. Due to the remaining variables in the Plan, however, there are no
assurances as to the actual amount to be received. The Plan also provides that
PC Development Limited Partnership will continue as the General Partner of the
Partnership.
17
<PAGE> 18
(3) ORGANIZATION AND BUSINESS
The Partnership is a Delaware limited partnership formed on April 3, 1987. The
Partnership will continue in existence until the close of Partnership business
on December 31, 2037, or until its earlier termination in accordance with the
provisions of the Amended and Restated Agreement of Limited Partnership (the
Partnership Agreement).
On July 23, 1987, the Partnership received the net proceeds of an initial public
offering of 3,110,000 Units of Limited Partner Interest representing gross
offering proceeds of $31,100,000. On July 30, 1987, the Partnership purchased
from its General Partner the Tampa hotel and the Disney hotel. On December 15,
1987, the Partnership purchased and opened the Raleigh/Durham hotel.
The Partnership is a party to a Management Agreement with Doubletree to operate
and manage the hotels. The Management Agreement expires on December 29, 2011
with two consecutive ten year renewal options. The Partnership pays a base
management fee of 4.75% of hotel revenues. Doubletree assessed the properties
three and one-half percent of total departmental revenues for national
advertising during 1994 and four percent of room revenues for national
advertising and centralized reservation services in 1995. Effective January 1,
1996, Doubletree will assess the properties three and one-half percent of room
revenues for national advertising and centralized reservation services. Other
centralized services such as accounting are provided by Doubletree to the
Partnership's properties based upon each hotel's share of such costs.
(4) SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates. The
Partnership's significant accounting policies are as follows:
Inventories:
Inventories, consisting principally of food and beverages, are valued at the
lower of cost (first-in, first-out) or market.
18
<PAGE> 19
Property and equipment:
The initial purchase price allocation to land, leasehold interest in land,
hotels, and furniture, fixtures and equipment was based upon independent
appraisals obtained in connection with the public offering. Any cash payments
made by the General Partner pursuant to its Guaranty Agreement (see Notes 2, 9,
and 10) are recorded as a reduction in the purchase price originally allocated
to the hotels. Depreciation and amortization are provided using the
straight-line method over the estimated useful lives or lease terms, as follows:
leasehold interest in land--initial lease life of 45 years; hotels--45 years;
furniture, fixtures and equipment--3, 5, and 10 years.
China, glass, linen and silver:
A portion of the initial purchase price was allocated to china, glass, linen and
silver for the amounts on-hand on the date of acquisition. The base stock method
of accounting is used whereby the cost of maintaining and replenishing the base
stock is expensed as incurred.
Deferred financing fees and organization costs:
Deferred financing fees are amortized over the life of the related loans and
credit agreements using the straight-line method. Organization costs are
amortized over five years using the straight-line method. Such fees and costs
are net of accumulated amortization of $1,380,640 and $1,190,680 at December 31,
1995 and December 31, 1994, respectively.
Self-Insurance Program:
The Partnership uses a retrospective self-insurance plan for workers'
compensation. A provision has been made in the financial statements, based on
information currently available, which represents the expected future payments
based on the estimated ultimate cost for incidents incurred prior to the balance
sheet dates. Encompassed in this provision are refundable workers' compensation
deposits which result from deposit payments made in excess of the estimated
ultimate cost expected to be incurred.
Cash and cash equivalents:
The Partnership considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.
19
<PAGE> 20
(5) REPLACEMENT RESERVE FUND
As required under current debt agreements the Partnership funded replacement
reserves based upon revenue percentages of 2% for the Tampa and Raleigh/Durham
hotels and 3% for the Disney hotel during 1995, 1994, and 1993. Beginning in
1996 replacement reserves will be calculated at 4% of revenues at all three
hotels. During the years ended December 31, 1995, 1994, and 1993, $526,745,
$503,104 and $481,898, respectively, were reserved to fund capital improvements.
(6) LEASES
The land for the Disney hotel is leased by the Partnership under an operating
lease, the initial term of which expires March 11, 2032, with a renewal option
for an additional period of 25 years. The Partnership pays annual rent based
upon specified percentages of suite, food and beverage, and other hotel
revenues, subject to a $100,000 minimum annual rent. Rent is computed and paid
quarterly. Rent expense under this lease was $596,269 in 1995, $592,453 in 1994,
and $568,868 in 1993.
(7) REAL ESTATE MORTGAGE NOTES
The nonrecourse notes in the original aggregate amount of $43,300,000 are
secured by the first mortgages on the hotels, including the ground lease at the
Disney hotel. In February, 1991, the lender applied $2,000,000 of the General
Partner's funds, previously held in escrow, against the principal balance of the
notes. On May 26, 1993, the Partnership modified certain terms of the mortgage
loan documents. Accordingly, during 1993 unpaid interest accruing in the
aggregate amount of $4,876,267 was added to the principal balance of the
mortgage computed at the contract rate of 10.25%. Additionally, the Partnership
borrowed $219,000 during 1993 to pay for closing costs incurred with the
modifications. During 1993 interest was payable at an annual rate of 9% of
$41,300,000 (original loan balance). During 1994 and 1995, the Partnership made
monthly payments of principal and interest on the outstanding principal of
$46,395,267 based upon a 30-year amortization schedule. A final payment,
including interest, is due on August 1, 1997. Principal amounts due in 1996, and
1997 are $273,979, and $45,528,387. The lender will receive 25% of the net
proceeds, as defined, at sale of the hotels, or net proceeds based upon market
value if the hotels are not sold prior to the maturity of the loan, as
appreciation interest.
Doubletree has made a loan commitment of up to $1,000,000, to fund cash deficits
in the event the Partnership cannot meet its obligation to make debt service
payments. No amounts have been borrowed under the debt service agreement at
December 31, 1995.
The Partnership is subject to prepayment penalties at all times except on the
interest adjustment date and during the last three months of the loan term. Any
future subordinate financing to be secured by all or any of the hotels is
subject to the lender's prior consent.
Due to the Partnership's current financial condition and excessive cost,
assessment of the fair value was determined to be impracticable.
20
<PAGE> 21
(8) NOTE PAYABLE
On October 26, 1994, the Partnership borrowed $500,000 from Doubletree for
capital improvements. This nonrecourse note is secured by second mortgages on
the hotels and is due at the termination of the management agreement with
Doubletree (see Note 3). Interest is computed at 10.25% payable monthly in
arrears and payment is equal to the lesser of the monthly computed interest due
or monthly available cash flow from the Partnership.
Due to the Partnership's current financial condition and excessive cost,
assessment of the fair value was determined to be impracticable.
(9) RELATED PARTIES
The General Partner, an affiliate, is generally empowered by the Partnership
Agreement to conduct, direct and exercise full control over all activities of
the Partnership.
Total fees charged by Doubletree to the Partnership for management, advertising,
reservation and accounting services were $1,793,723, $1,919,253, and $1,720,294
during 1995, 1994, and 1993, respectively. Nuho Company, a successor to PH
Management Company (a previous management company) pursuant to the bankruptcy
plan, received residual management fees of $515,669, $487,783, and $466,186
during 1995, 1994, and 1993, respectively.
(10) PARTNERSHIP DISTRIBUTIONS AND ALLOCATIONS
Pursuant to the terms of the renegotiated debt, the Partnership is precluded
from making cash distributions to the partners until such time as the interest
capitalized by the lender (see Note 7) has been repaid. This is not expected to
occur prior to the maturity of the first mortgage loans on August 1, 1997.
Cash flow available for distribution will be distributed 99 percent to the
Unitholders and 1 percent to the General Partner until the Unitholders have
received cash distributions sufficient to provide a 10 percent (11 percent for
the fiscal years 1987 through 1990) noncompounded, cumulative return on the
weighted average balances of the net invested capital (originally $31,100,000 in
the aggregate) outstanding during such year. Any remaining cash flow available
for distribution in excess of the foregoing amounts will be distributed 15
percent to the General Partner and 85 percent to the Unitholders, until the
General Partner has received an amount equal to 10 percent of all cash flow
available for distribution which has been distributed and, thereafter, 90
percent to the Unitholders and 10 percent to the General Partner.
Sale or refinancing proceeds, net of any appreciation interest due the lender
(see Note 7), will be distributed 99 percent to the Unitholders and 1 percent to
the General Partner until the Unitholders have received (from all prior
distributions of cash, regardless of source) a 10 percent noncompounded
cumulative return on their weighted average net invested capital and a return of
their net invested capital balances. Any remaining sale or refinancing proceeds
will be distributed 70 percent to the Unitholders and 30 percent to the General
Partner.
21
<PAGE> 22
Distributions resulting from a liquidation of the Partnership will be paid to
the Partners in accordance with their positive capital account balances after
such balances have been adjusted to reflect allocations of taxable income and
taxable loss.
For federal income tax purposes, taxable income, whether from operations or the
sale of a hotel, is allocated first to restore any deficit balances of the
General Partner and Unitholders on a proportionate basis. Unitholders and the
General Partner are then allocated taxable income 99 percent and 1 percent,
respectively, (to the extent of cash distributions in this ratio) until the
Unitholders have been allocated an amount equal to their net invested capital
plus a 10 percent (11 percent for fiscal years 1987 through 1990) noncompounded,
cumulative return on the weighted average balances of the net invested capital
outstanding plus all prior distributions to the Unitholders of sale or
refinancing proceeds. Thereafter, taxable income is allocated in the same
proportions as and to the extent of distributions of cash.
For federal income tax purposes, taxable loss, whether from operations or the
sale of a hotel, is allocated first to the extent of previously allocated
taxable income in excess of distributions of cash and, thereafter, 99 percent to
the Unitholders and one percent to the General Partner, except that the General
Partner shall receive a special loss allocation to the extent of its cash
payments pursuant to the Guaranty Agreement. Unitholders of record on the last
day of each month will be allocated the proportionate share of income or loss
for that entire month.
Cash payments made by the General Partner pursuant to its Guaranty Agreement
have been recorded as a reduction of the purchase price of the hotels.
Accordingly, net property and equipment has been reduced by $10,698,800,
reflecting $12,430,335 in payments by the General Partner net of accumulated
depreciation of $1,731,535, through December 31, 1995. The equity accounts of
the Limited Partners and the General Partner reflect a 99 percent and 1 percent
allocation, respectively, of cumulative losses through December 31, 1995.
(11) INCOME TAXES
Partnership taxable income or loss is allocated to the Partners according to the
Partnership Agreement for inclusion in the determination of their taxable
income. Accordingly, the accompanying financial statements include no provision
for income taxes. The Partnership has considered statement of Financial
Accounting Standard Number 109 "Accounting for Income Taxes" and, given the
cumulative operating losses, has concluded that this standard has no impact on
the Partnership's current financial statements.
The net losses for 1995, 1994, and 1993, as reported on the Partnership's
federal tax return were ($701,970), ($1,934,790), and ($3,761,095),
respectively, and differ from the net losses as reported in the accompanying
financial statements primarily due to the difference between tax and book
depreciation charges. This difference is due principally to cash payments made
by the General Partner pursuant to its Guaranty Agreement (See Note 2) being
recorded as a capital contribution for tax purposes versus a reduction in net
property and equipment for financial reporting purposes and different
depreciation lives for tax and book purposes. The net losses for tax purposes
allocable to the Unitholders during 1995, 1994, and 1993 were ($653,778) or
($.21) per unit, ($1,862,502) or ($.60) per unit, and ($3,615,573) or ($1.17)
per unit, respectively.
22
<PAGE> 23
Under the Revenue Act of 1987, the Partnership's interest income is taxable to
its Partners in the current year as portfolio income while the loss from
operations for tax purposes is suspended. This suspended loss can only be used
to offset future taxable income of the Partnership or can be recognized by a
partner upon a complete disposition of his interest in the Partnership. The
provision of the Revenue Act of 1987 which taxes publicly traded partnerships as
corporations does not apply to PSH Master L.P. I until 1998.
The Revenue Act of 1987 included a provision which will treat publicly-traded
partnerships, such as the Partnership, as corporations for Federal income tax
purposes beginning January 1, 1998. The effect of treating publicly-traded
partnerships as corporations will be to tax the income of the partnership at the
entity level and reflect distributions to partners as dividends. Additional
costs to the Partnership for such taxes would reduce the amount available for
distribution to the partners.
23
<PAGE> 24
INDEPENDENT AUDITORS' REPORT
To the Partners of PSH Master L.P. I:
We have audited the accompanying balance sheets of PSH Master L.P. I
(the "Partnership") as of December 31, 1995, and 1994, and the related
statements of operations, partners' deficit, and cash flows for each of the
three years in the period ended December 31, 1995. These financial statements
are the responsibility of the Partnership's management. Our responsibility is to
express (or disclaim) an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our report.
The accompanying financial statements have been prepared assuming that
the Partnership will continue as a going concern. As discussed in Note 1 to the
financial statements, the Partners' accumulated deficits and uncertainty
regarding the Partnership's ability to make the final payment on the mortgage
loan on August 1, 1997 or refinance the debt raise substantial doubt about its
ability to continue as a going concern. Management's plans concerning these
matters are also described in Note 1. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
Because of the possible material effects of the uncertainty referred to
in the preceding paragraph, we are unable to express, and we do not express, an
opinion on the accompanying financial statements.
/s/
DELOITTE & TOUCHE LLP
Columbus, Ohio
February 17, 1996
24
<PAGE> 25
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The Registrant has no directors or executive officers. James V. Pickett, an
officer of PH Management Company, the general partner of PC Development Limited
Partnership, was late filing one report required by Section 16(a) of the
Securities Exchange Act of 1934 with respect to one purchase of units of limited
partnership interest.
ITEM 11. EXECUTIVE COMPENSATION.
The Registrant has no executive officers or other employees.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
James V. Pickett, Chairman and President of PH Management Company, the general
partner of the Partnership's general partner - PC Development Limited
Partnership, purchased 200,000 units in November, 1995, which represents
approximately 6% of the outstanding units, bringing the total units owned by Mr.
Pickett, both directly and indirectly to 225,000 units, or approximately 7% of
the outstanding units.
The Registrant has no other beneficial owners of more than 5% of any voting
securities and has no directors or executive officers.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Not applicable.
25
<PAGE> 26
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
<TABLE>
<CAPTION>
Document Location
- - -------- --------
<C> <S> <C>
(a) 1. Financial Statements Item 8.
2. Financial Statement Schedules Item 14.(d)
3. Exhibits:
3.1 Amended and Restated Agreement of PSH Master L.P. I *
3.2 Certificate of Limited Partnership of PSH Master L.P. I *
4.1 Promissory Note (Durham) **
4.2 Deed of Trust, Assignment of Rents and Security
Agreement (Durham) **
4.3 Promissory Note (Orlando) **
4.4 Leasehold Mortgage and Security Agreement (Orlando) **
4.5 Promissory Note (Rocky Point) **
4.6 Mortgage and Security Agreement (Rocky Point) **
10.1 Performance and Breakeven Guaranty *
10.2 Management Agreement *
10.3 Purchase Agreement ****
10.4 Escrow Agreement ****
10.5 Deposit Agreement (including form of Depository Receipt) ****
10.6 The Disney Ground Lease *
10.8 Non-Competition Agreement ****
10.9 Consent to Submanagement Agreement and
Amendment to Management Agreement *****
10(a) Future Advance Promissory Note (Orlando) dated as of
January 1, 1992, from PSH Master L.P. I to Aetna Life
Insurance Company. ******
10(b) Consolidated and Renewal Promissory Note (Orlando)
dated as of January 1, 1992, from PSH Master L.P. I to Aetna
Life Insurance Company. ******
10(c) Future Advance Promissory Note (Deferred Interest/
Orlando) dated as of January 1, 1992, from PSH Master
L.P. I to Aetna Life Insurance Company. ******
10(d) Modification Agreement (Orlando/Tampa) dated as of
January 1, 1992, between PSH Master L.P. I and Aetna
Life insurance Company. ******
10(e) Future Advance Promissory Note (Tampa) dated as of
January 1, 1992, from PSH Master L.P. I to Aetna Life
Insurance Company. ******
10(f) Consolidated and Renewal Promissory Note (Tampa)
dated as of January 1, 1992, from PSH Master L.P. I to
Aetna Life Insurance Company. ******
10(g) Future Advance Promissory Note (Deferred Interest/
Tampa) dated as of January 1, 1992, from PSH Master L.P. I
to Aetna Insurance Company. ******
</TABLE>
26
<PAGE> 27
<TABLE>
<CAPTION>
Document Location
- - -------- --------
<C> <S> <C>
10(h) Modification Agreement (Tampa/Orlando) dated as of
January 1, 1992, between PSH Master L.P. I to Aetna Life
Insurance Company. ******
10(i) Future Advance Promissory Note (Durham) dated as of
January 1, 1992, from PSH Master L.P. I to Aetna Life
Insurance Company. ******
10(j) Consolidated and Renewal Promissory Note (Durham)
dated as of January 1, 1992, from PSH Master L.P. I to
Aetna Life Insurance Company. ******
10(k) Future Advance Promissory Note (Deferred Interest/
Durham) dated as of January 1, 1992, from PSH Master L.P. I
to Aetna Life Insurance Company. ******
10(l) Modification Agreement (Durham) dated as of January 1,
1992, from PSH Master L.P. I to Aetna Life
Insurance Company. ******
10(m)Mortgage and Security Agreement dated as of January 1,
1992, from PH Master L.P. I to Aetna Life Insurance
Company. ******
10(n) Consolidation and Modification Agreement dated as of
January 1, 1992, from PSH Master L.P. I to Aetna Life
Insurance Company. ******
10(o) Deferred Interest and Payment Agreement dated as of
January 1, 1992, between PSH Master L.P. I and Aetna
Life Insurance Company. ******
10(p) Assignment of Claim dated as of May 24, 1993, between
PSH Master L.P. I and Aetna Life Insurance Company. ******
10(q) Improvement Reserve Escrow Agreement dated as of
May 24, 1993, among PSH Master L.P. I, Aetna Life
Insurance Company, and BancBoston Mortgage Corp. ******
10(r) Promissory Note dated as of May 24, 1993, from PSH Master
L.P. I to Guest Quarters Hotels Partnership in the
original principal amount of $500,000. ******
10(s) Promissory Note dated as of May 24, 1993, from PSH Master
L.P. I to Guest Quarters Hotels Partnership in the
original principal amount of $1,000,000. ******
10(t) Mortgage and Security Agreement (Rocky Point) dated as
of May 24, 1993, from PSH Master L.P. I to Guest Quarters
Hotels Partnership. ******
10(u) Leasehold Mortgage and Security Agreement (Orlando/
Disney) dated as of May 24, 1993, from PSH Master L.P. I
to Guest Quarters Hotels Partnership. ******
10(v) Deed of Trust dated as of May 24, 1993, from PSH Master
L.P. I to Guest Quarters Hotels Partnership. ******
10(w) Third Amendment to Management Agreement dated as
of May 24, 1993, between PSH Master L.P. I and Guest
Quarters Hotels Partnership. ******
</TABLE>
27
<PAGE> 28
<TABLE>
<CAPTION>
Document Location
- - -------- --------
<C> <S> <C>
16.1 Letter regarding Change in Certifying Accountant ***
* Previously filed with the Securities and Exchange Commission in connection
with the Registration Statement on Form S-1 of Pickett Suite Hotel Master
L.P. I, Registration No. 33-13961, dated July 15, 1987.
** Previously filed with the Securities and Exchange Commission Form 8-K, dated
December 15, 1987.
*** Previously filed with the Securities and Exchange Commission Form 8-K, dated
December 8, 1988.
**** Previously filed with the Securities and Exchange Commission Form 10-K, dated
December 31, 1987.
***** Previously filed with the Securities and Exchange Commission Form 8-K, dated
December 6, 1989.
****** Previously filed with the Securities and Exchange Commission Form 8-K dated
August 13, 1993.
(b) None.
(c) All required exhibits have previously been filed as described in Paragraph
(a) of this Item 14.
(d) Financial Statement Schedules are omitted because of the absence of the
condition under which they are required.
</TABLE>
28
<PAGE> 29
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
PSH MASTER L.P. I
(Registrant)
By: PC Development Limited Partnership, General Partner
By: PH Management Company, General Partner
/s/
By: James V. Pickett 3/29/96
------------------------------------------- ----------
James V. Pickett, Chairman and President Date
/s/
By: Stephen C. Denz 3/29/96
------------------------------------------- ----------
Stephen C. Denz, Secretary and Controller Date
(Principal Financial Officer)
Pursuant to the requirements of the Securities and Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the date indicated.
/s/
James V. Pickett 3/29/96
------------------------------------------- ----------
James V. Pickett, Chairman and President of Date
PH Management Company
No proxy statement, form of proxy or other proxy soliciting material has been
sent to Unitholders prior to the filing of this annual report on Form 10-K.
29
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000813897
<NAME> PSH MASTER L.P.I.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 579,253
<SECURITIES> 0
<RECEIVABLES> 986,029
<ALLOWANCES> 0
<INVENTORY> 103,444
<CURRENT-ASSETS> 2,349,994
<PP&E> 58,516,070
<DEPRECIATION> 22,338,504
<TOTAL-ASSETS> 39,675,237
<CURRENT-LIABILITIES> 2,660,971
<BONDS> 46,028,387
0
0
<COMMON> 0
<OTHER-SE> (9,014,121)
<TOTAL-LIABILITY-AND-EQUITY> 39,675,237
<SALES> 21,887,229
<TOTAL-REVENUES> 21,905,694
<CGS> 0
<TOTAL-COSTS> 17,906,955
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,769,181
<INCOME-PRETAX> (770,442)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (770,442)
<EPS-PRIMARY> (.25)
<EPS-DILUTED> (.25)
</TABLE>
