U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB/A
Amendment No. 1
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____ to ____
Commission file number 0-22132
BUCKHEAD AMERICA CORPORATION
(Name of small business issuer in its charter)
DELAWARE 58-2023732
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
4243 Dunwoody Club Drive, Suite 200, Atlanta, Georgia 30350
(Address of principal executive offices)
Issuer's telephone number. (770)-393-2662
Securities registered under Section 12(b) of the Exchange Act:
None None
(Title of each class) (Name of each exchange on which registered)
Securities registered under Section 12(g) of the Exchange Act:
Common stock, par value $.01
(Title of Class) $.01
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 .
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will 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-KSB
or any amendment to this Form 10-KSB.[X]
State issuer's revenues for its most recent fiscal year. $13,872,805
State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such stock, as of a specified date within
the past 60 days. As of April 30, 1997: $8,202,187
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date. As of April 30, 1997:
Common Stock, par value $.01 - 1,771,127 shares outstanding
DOCUMENTS INCORPORATED BY REFERENCE
No documents which are required to be listed under this caption are
incorporated by reference.
Transitional Small Business Disclosure Format (Check one): Yes___; No __X__.
<PAGE>
The Registrant hereby amends Part I Item 2 of its Annual Report on Form
10-KSB for the year ended December 31, 1996 as set forth below.
ITEM 2. DESCRIPTION OF PROPERTY.
CORPORATE OFFICES
_________________
The Company's corporate headquarters are located at 4243 Dunwoody Club
Drive, Suite 200, Atlanta, Georgia. The Company leases approximately 3,600
square feet as its corporate headquarters. The lease term extends through
October 1997 at an annual rate of approximately $49,000. The Company believes
that such headquarters are adequate for its current needs.
OWNED REAL PROPERTIES
_____________________
LAND. As of February 28, 1997, the Company owned six parcels of
undeveloped and unencumbered land, with an aggregate book value of $215,500. All
of such parcels are held for sale.
The following table sets forth certain information for each of the
Company's hotels:
<TABLE>
<CAPTION>
REVENUE
AVERAGE AVERAGE PER
NO. OF YEAR YEAR OCCUPANCY DAILY AVAILABLE TOTAL
PROPERTIES ROOMS BUILT ACQUIRED RATE RATE ROOM REVENUE
- ------------------------ ------------- ------------ ------------- --------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Days Inn
Daytona, FL 180 1972 03/1993 46.0% $ 41.45 $ 19.07 $ 1,680,587
Country Hearth Inn
Orlando, FL(1) 150 1985 05/1995 84.7% 63.12 53.46 3,849,811
Country Hearth Inn
Freeport, TX 40 1984 12/1995 47.5% 46.36 22.02 332,363
Country Hearth Inn
Wharton, TX 40 1986 12/1995 63.6% 44.67 28.41 432,486
Country Hearth Inn
Angleton, TX 40 1984 12/1995 63.9% 44.35 28.34 427,329
Country Hearth Inn,
Atlanta, GA(2) 82 1971 03/1996 46.6% 59.18 27.58 690,522
Country Hearth Inn,
Dalton, GA(3) 96 1967 08/1996 ---- ---- ---- ----
</TABLE>
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(1) As of May 15, 1997, the Company had substantially completed a
renovation project of approximately $200,000.
(2) Converted into a Country Hearth Inn beginning in September,
1996 at a total cost of approximately $800,000. The conversion
was completed in January, 1997. Due to the recent renovation,
performance of the hotel is expected to be more dependent on
future marketing efforts as opposed to historical performance.
(3) Converted into a Country Hearth Inn during 1996 at a total
cost of approximately $650,000. The conversion was completed
in February 1997. Due to the recent renovation, performance of
the hotel is expected to be more dependent on future marketing
efforts as opposed to historical performance.
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DAYTONA HOTEL. The Company owns a 180-room Days Inn hotel in Daytona,
Florida (the "Daytona Hotel"), which was acquired by the Company through
foreclosure in March 1993. The hotel was acquired subject to a first mortgage
which was in default. The mortgage note was restructured effective May 15, 1994
and as of December 31, 1996 had an unpaid balance of $2,108,868. The
restructured note bears interest at 8%, and is due in monthly installments of
$15,850 until April 15, 1999 at which time the then remaining balance will be
due.
The market for comparable rooms is extremely competitive due to the
large number of hotels/motels in the Daytona area. The area does benefit,
however, from certain event related demand peaks. Average room occupancy and
average daily rate during 1996 was 46.0% and $41.45, respectively.
Renovation and environmental programs are continuously ongoing and the
Company believes adequate funds are available for these purposes. In the opinion
of management, the property is adequately covered by insurance and is suitable
and adequate for its present use. Property taxes in 1996 were approximately
$64,000.
Differences between financial reporting asset bases and federal tax
bases are not significant. Straight-line depreciation methods are used based on
useful lives of 40 years for depreciable real property and 5-10 years for all
other depreciable property.
ORLANDO HOTEL. On May 15, 1995, the Company acquired the majority
ownership of a 150-room hotel in Orlando, Florida (the "Orlando Hotel"). Prior
to the acquisition, the Company held a second mortgage on the property with an
aggregate principal and interest balance of approximately $2.8 million (the "Old
Second Mortgage"). The second mortgage balance was reduced to $1 million (the
"New Second Mortgage") in exchange for a fifty-five percent (55%) interest in
Heritage Inn Associates, Ltd., the partnership which owns the hotel. The hotel
was also subject to a first mortgage which collateralized certain Orange County,
Florida industrial development bonds (the "Orlando IRB").
The Orlando IRB and the New Second Mortgage were fully paid and
satisfied in November 1996 with proceeds from a new first mortgage loan secured
by the property (the "First Mortgage Loan"). The First Mortgage Loan had a
December 31, 1996 balance of $4,593,580, bears interest at 9.55% and requires
monthly principal and interest payments of $43,028 until December 2016 at which
time the then remaining balance is due and payable.
The market for hotel rooms in Orlando is extremely competitive due to
the multitude of properties in the area. The Orlando Hotel does benefit from the
large number or local attractions and from the Orlando Convention Center
activities. The hotel is positioned as a lower priced alternative property
situated among mega-room high rises. Average room occupancy and average daily
rate during 1996 was 84.7% and $63.12, respectively.
Renovation and environmental programs are continuously ongoing and the
Company believes adequate funds are available for these purposes. The First
Mortgage Loan required the Company to expend approximately $200,000 for
maintenance and improvements; as of February 28, 1997, these requirements were
substantially completed. In the opinion of management, the property is
adequately covered by insurance and is suitable and adequate for its present
use. Property taxes in 1996 were approximately $110,000.
Differences between financial reporting asset bases and federal tax
bases are not significant. Straight-line depreciation methods are used based on
useful lives of 40 years for depreciable real property and 5-10 years for all
other depreciable property.
TEXAS HOTELS. On December 7, 1995 Buckhead purchased three Homeplace
Inn hotel properties in Texas from affiliates of American Liberty Hospitality,
Inc. ("ALH"). The three hotels secure a first mortgage loan with a December 31,
1996 balance of $2,355,362. The remainder of the $3.6 million purchase price
(the estimated fair value) was paid with approximately $950,000 cash and 41,558
shares of the Company's common stock. The
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<PAGE>
first mortgage loan matures December 7, 2002, bears interest at 9.05%, requires
monthly payments of $21,680, is guaranteed by the Company, and contains certain
minimum net worth and debt to equity ratio requirements -- See "MARKET FOR
COMMON EQUITY AND RELATED STOCKHOLDER MATTERS -- DIVIDENDS."
Immediately upon acquisition, the acquired hotels (the "Texas Hotels")
along with three other ALH owned Homeplace Inn properties were converted to
operate as Country Hearth Inns.
The Texas Hotels are limited service 40-room properties located in
smaller southeastern Texas cities. Generally, comparable rooms are not
immediately available in their selected markets. Occupancy and room rates
averaged approximately 58.3% and $45.01, respectively, during 1996.
Renovation and environmental programs are continuously ongoing and the
Company believes adequate funds are available for these purposes. In the opinion
of management, the properties are adequately covered by insurance and are
suitable and adequate for their present use. Property taxes in 1996 totaled
approximately $41,000.
Differences between financial reporting asset bases and federal tax
bases are not significant. Straight-line depreciation methods are used based on
useful lives of 40 years for depreciable real property and 5-10 years for all
other depreciable property.
ATLANTA HOTEL. On March 11, 1996, the Company acquired an 82-room hotel
in Atlanta, Georgia formerly known as the Sandy Springs Inn (the "Atlanta
Hotel"). During the latter half of 1996, the hotel was renovated and refurbished
for conversion to operate as a Country Hearth Inn. The conversion was
substantially completed in January 1997 at a total cost of approximately
$800,000, approximately half of such was financed through lease arrangements.
The Atlanta Hotel secures a first mortgage loan with a December 31,
1996 balance of $2,170,713. The loan bears interest at 9.5% and requires monthly
payments of $20,350 until August 11, 2006.
The market for hotel rooms in Atlanta is extremely competitive due to
the multitude of properties in the area. The hotel is positioned as a moderately
priced property targeted primarily at business travelers. Prior to and during
renovation, the hotel had average room occupancy of 46.6% and an average daily
rate of $59.18. Due to the recent renovation, performance of the hotel will be
more dependent on future marketing efforts as opposed to historical performance.
Renovation and environmental programs are continuously ongoing and the
Company believes adequate funds are available for these purposes. In the opinion
of management, the property is adequately covered by insurance and is suitable
and adequate for its present use. Property taxes in 1996 were approximately
$40,000.
Differences between financial reporting asset bases and federal tax
bases are not significant. Straight-line depreciation methods are used based on
useful lives of 40 years for depreciable real property and 5-10 years for all
other depreciable property.
DALTON HOTEL. On August 30, 1996 , the Company acquired a 96-room hotel
in Dalton, Georgia formerly known as the Sunset Inn (the "Dalton Hotel"). The
Company immediately initiated a renovation and refurbishment project to convert
the hotel to operate as a Country Hearth Inn. The project was substantially
completed in February 1997 at a total cost of approximately $650,000.
The Dalton Hotel secures a first mortgage loan with a December 31, 1996
balance of $1,046,148. The loan bears interest at 9.15% and requires monthly
payments of $9,549 until September 1, 2001 at which time the then remaining
balance is due.
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<PAGE>
The property is positioned to compete with the existing low and
moderately priced properties in the area. It will also compete with new
properties presently under development in the area. It is located adjacent to
and is highly visible from I-75, a major north/south interstate highway.
Performance statistics during 1996 are not meaningful due to the heavy
renovations which were in progress. Future operations of the property will be
dependent on the success of future marketing efforts.
Renovation and environmental programs are continuously ongoing and the
Company believes adequate funds are available for these purposes. In the opinion
of management, the property is adequately covered by insurance and is suitable
and adequate for its present use. Property taxes in 1996 were approximately
$21,000 on an annualized basis.
Differences between financial reporting asset bases and federal tax bases
are not significant. Straight-line depreciation methods are used based on useful
lives of 40 years for depreciable real property and 5-10 years for all other
depreciable property.
REAL PROPERTIES PROPOSED TO BE ACQUIRED
_______________________________________
The Company announced in March 1997 that it had entered into two
separate purchase agreements for the acquisition of hotels, hotel management
contracts, and a hotel management business--See "Managements Discussion and
Analysis of Financial Condition and Results of Operations--FINANCIAL CONDITION
AND CHANGES IN FINANCIAL CONDITION."
INVESTMENT POLICIES
___________________
A substantial portion of the Company's existing real estate and real
estate related assets were acquired directly or indirectly as a result of the
transfer of assets from Old Buckhead and are principally hospitality related.
Asset acquisitions since inception have also been predominately hospitality
related and made for the primary purpose of generating additional income.
Further, management's experience and expertise is in the hospitality business.
Accordingly, the Company has determined that it will primarily seek out
investments in the hospitality industry. In that regard, the Board of Directors
has determined that the Company will focus upon investments in hospitality
related companies with income growth potential. Such investments could take the
form of (a) hotel property purchases, (b) hotel mortgage purchases, (c) hotel
mortgage servicing, (d) hotel management and/or (e) hotel franchising. The Board
of Directors has not set any limitations on the percentage of assets which may
be invested in any one investment. The policy herein may be changed without a
vote of security holders.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.
(a) INDEX TO EXHIBITS
-----------------
Exhibit Description Page
------- ----------- ----
2(a) Closing Agreement dated May 15, 1995 between ***
Heritage Inn Associates, Ltd. and
BLM EB, Inc.
2(b) Agreement for Purchase and Sale of Hotel between ****
Buckhead and ALH Properties No. One, Inc.
2(c) Agreement for Purchase and Sale of Hotel between ****
Buckhead and ALH Properties No. Two, Inc.
3(i) Articles of Incorporation *
3(i)(a) Certificate of Amendment of Certificate of Incorporation **
3(ii) By-Laws - Amended and Restated as of June 27, 1994 **
4(ii) Mortgage Note Payable dated as of November 7. 1996 +
made by Heritage Inn Associates, LP as maker,
to Bloomfield Acceptance Company, LLC
10(ii)(a) Employment Agreement dated as of June 30, 1993 *
between the Company and Douglas C. Collins
10(ii)(b) Amendment to Douglas C. Collins Employment Agreement #
10(ii)(c) Employment Agreement dated as of June 30, 1993 #
between the Company and Robert B. Lee
10(ii)(d) Amendment to Robert B. Lee Employment Agreement #
10(ii)(e) Employment Agreement dated as of April 29, 1996 +
between the Company and Gregory C. Plank
10(ii)(f) 1995 Stock Option Plan *****
21 Subsidiaries of the Company +
23 Accountants' Consent 8
27 Financial Data Schedule (Electronic filing only) +
54
<PAGE>
* Previously filed as an Exhibit to the Registrant's Registration
Statement on Form 10-SB which became effective on November 22,
1993 and incorporated herein by reference.
** Previously filed as the same Exhibit number to the Registrant's
December 31, 1994 Form 10-KSB and incorporated herein by
reference.
*** Previously filed as an Exhibit to the Registrant's May 15, 1995
Form 8-K and incorporated herein by reference.
**** Previously filed as an Exhibit to the Registrant's December 7,
1995 Form 8-K and incorporated herein by reference.
***** Previously filed as Appendix A to the Registrant's Definitive
Proxy Statement dated April 25, 1995 and incorporated herein by
reference.
# Previously filed as an Exhibit to the Registrant's December 31,
1995 Form 10-KSB and incorporated herein by reference.
+ Previously filed as the same Exhibit number to the Registrant's
December 31, 1996 Form 10-KSB and incorporated herein by
reference.
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<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
(Registrant) BUCKHEAD AMERICA CORPORATION
By: (Signature and Title):
/s/ Douglas C. Collins /s/ Robert B. Lee
---------------------------- -----------------------------
Douglas C. Collins Robert B. Lee
President & Senior Vice President & Chief
Chief Executive Officer Financial & Accounting Officer
Date: May 29, 1997 Date: May 29, 1997
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Exhibit 23
ACCOUNTANTS' CONSENT
--------------------
The Board of Directors
Buckhead America Corporation:
We consent to incorporation by reference in the Registration Statement (No.
333-05313) on Form S-3 and in the Registration Statement (No. 33-97046) on Form
S-8 of Buckhead America Corporation of our report dated February 21, 1997,
except for note 13, which is dated as of March 13, 1997 relating to the
consolidated balance sheets of Buckhead America Corporation and subsidiaries as
of December 31, 1996 and 1995, and the related consolidated statements of
income, shareholders' equity, and cash flows for the years then ended, which
report appears in the December 31, 1996 annual report on Form 10- KSB of
Buckhead America Corporation.
KPMG PEAT MARWICK LLP
Atlanta, Georgia
May 29, 1997
