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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
DECEMBER 9, 1996
PATRIOT AMERICAN HOSPITALITY, INC.
(Exact name of Registrant as specified in its Charter)
VIRGINIA 0-26528 75-2599709
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
3030 LBJ FREEWAY, SUITE 1500 75234
DALLAS, TEXAS (Zip Code)
(Address of Principal Executive Offices)
(972) 888-8000
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if change since last report)
Index to Exhibits appears on page 3 herein.
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ITEM 5. OTHER EVENTS
On December 9, 1996, Patriot American Hospitality, Inc. ("Patriot") entered
into an Acquisition Agreement ("Agreement") with the owners of Carefree Resorts
Corporation ("Carefree"),Resorts Limited Partnership ("RLP"), and Resorts
Services, Inc. ("Resorts") to acquire each of Carefree, RLP and Resorts and
their respective assets. The assets of Carefree, RLP and Resorts include the
entire Resort management organization and the interest in four world-class, four
star and five star Carefree Resort properties - The Boulders near Scottsdale,
Arizona; The Lodge at Ventana Canyon, in Tucson, Arizona; The Peaks Resort & Spa
in Telluride, in the Colorado Rockies; and Carmel Valley Ranch, in Carmel,
California; plus a contract to mange the Buttes in Tempe, Arizona. Total
anticipated value of the transaction is approximately $210 million in a
combination of cash, the assumption of debt and units of limited partner
interest in Patriot American Hospitality Partnership, L.P.
A copy of the Press Release of Patriot American Hospitality, Inc. dated
December 9, 1996 is attached hereto as Exhibit 99.1 and is incorporated herein
by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) The following exhibit is filed as part of this Report:
99.1 Press Release of Patriot American Hospitality, Inc. dated
December 9, 1996.
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Form 8-K to be signed on its behalf by the
undersigned hereunto duly authorized.
PATRIOT AMERICAN HOSPITALITY, INC.
/s/ Rex E. Stewart
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Rex E. Stewart,
Executive Vice President and
Chief Financial Officer
Date: December 18, 1996
3
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EXHIBIT INDEX
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Exhibit Page
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99.1 Press Release of Patriot American Hospitality, Inc. 3
dated December 9, 1996.
4
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Exhibit 99.1
NEWS BULLETIN FROM FRB PATRIOT AMERICAN HOSPITALITY, INC.
THE FINANCIAL RELATIONS BOARD 3030 LBJ FREEWAY, SUITE 1500
DALLAS, TX 75234
NYSE: PAH
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<CAPTION>
AT THE COMPANY: AT THE FINANCIAL RELATIONS BOARD:
<S> <C> <C> <C>
Paul Nussbaum, Chairman & CEO Bess Gallanis Claire Koeneman Bob Schwaller
Thomas Lattin, President and COO Media Inquiries Analyst Inquiries General Inquiries
972-888-8000 312-640-6737 312-640-6784 972-888-8087
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AT CAREFREE RESORTS:
Richard A. Holtzman, President
602-953-6400
FOR IMMEDIATE RELEASE
PATRIOT AMERICAN TO ACQUIRE CAREFREE RESORTS FOR $210 MILLION;
INCLUDES THE BOULDERS, PEAKS RESORT & SPA AND OTHER AWARD
WINNING CAREFREE PROPERTIES
DALLAS, DECEMBER 9, 1996 - PATRIOT AMERICAN HOSPITALITY, INC. (NYSE: PAH) has
reached an agreement with authorized representatives of the owners of Resorts
Limited Partnership, Carefree Resorts Corporation and Resorts Services, Inc. to
acquire these entities and their assets. The agreement is subject to the
approval of certain limited partners of Resort Limited Partnership. The assets
of these entities include the entire management organization and the interests
in four world-class, four-star and five-star Carefree resort properties-The
Boulders near Scottsdale, AZ; The Lodge at Ventana Canyon, in Tuscon, AZ; The
Peaks Resort & Spa in Telluride, in the Colorado Rockies; and Carmel Valley
Ranch, in Carmel, CA; plus a contract to manage The Buttes, in Tempe, AZ. Total
anticipated value of the transaction is approximately $210 million, in a
combination of cash, debt assumptions and units in Patriot's operating
partnership.
"These properties are renowned throughout the resort industry," said Patriot
Chairman and Chief Executive Officer Paul A. Nussbaum. "Each has received
countless industry awards and accolades; The Boulders has been named the top
U.S. resort by "Andrew Harper's Hideaway Report" every year for each of the last
10.
"Of equal importance to us," Nussbaum continued, "is the addition of the
exceptional Carefree management team, headed by President Richard A. Holtzman.
In addition to many
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other industry recognitions, Dick was named 'Hotel Magazine's' 'Independent
Hotelier of the World' for 1995. The Carefree organization is recognized as the
top resort management company in the industry, and has outstanding individual
talent. Dick and the others on the Carefree team add a dimension of resort
expertise to Patriot that is unmatched anywhere."
Patriot American has a binding agreement to acquire a paired-share REIT,
California Jockey Club and Bay Meadows Operating Company (ASE:CJ). Subject to
shareholder approval of both companies, Patriot currently anticipates that the
paired-share acquisition will be completed during the first quarter of 1997.
According to Patriot President and Chief Operating Officer Thomas W. Lattin,
"The paired-share structure will permit Patriot to receive substantially more of
the cash flow from the management of our hotel properties-while still retaining
the REIT tax-advantages in a non-conflicted structure.
"Pending approval of the paired-share transaction, it is our goal to have a
substantial portfolio of properties already in place for Patriot's paired
operating company to manage," said Lattin. "In this way our shareholders can
immediately begin to enjoy the operating advantages of the paired-share
structure. The Carefree acquisition will be Patriot's first such transaction.
However, Patriot's acquisition of Carefree is not conditioned upon the closing
of the paired-share transaction.
"With a resort management team of Carefree's caliber, and Patriot's corporate
management and financial resources, we see tremendous potential for future
growth in this market segment through the acquisition and development of
additional resorts in the U.S. as well as internationally," said Lattin.
"Carefree's strategy is to expand into target markets in the U.S. as well as the
rest of North America," said Carefree President Richard A. Holtzman. "Patriot's
financial strength, as well as the expected benefits following the acquisition
of the paired-share structure, gives us an edge in competing for the kind of
unique properties we are seeking."
ABOUT CAREFREE RESORTS. "Over the years," continued Holtzman, "we've very
deliberately established each Carefree property to be an exclusive destination
resort, one that rekindles the romance of travel by offering the qualities that
appeal to today's sophisticated traveler. We seek out magical settings, in
spectacular natural environments with a truly captivating sense of adventure.
We build in exceptional levels of service. We ensure that the cuisine reflects
regional specialties, adding to the unique ambiance of each resort.
"To enhance the sense of adventure, each resort provides a range of exotic
recreation opportunities - activities such as hot-air ballooning, cross-country
skiing, whitewater rafting, even llama treks and desert jeep tours," said
Holtzman.
Through the acquisition of Resorts Limited Partnership and Carefree, Patriot
American is acquiring a 100-percent interest in The Boulders and The Lodge at
Ventana Canyon, and a 50-percent interest in The Peaks Resort & Spa and Carmel
Valley Ranch Resort.
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THE BOULDERS. Carefree's signature asset, The Boulders, is located in Carefree,
AZ, north of Scottsdale, on 1,000 acres of Sonoran Desert foothills. The
Boulders offers 160 spacious guest "casitas" plus 33 private homes in a rental
pool. The resort includes two Jay Moorish 18-hole championship golf courses,
six tennis courts and two swimming pools, a fitness center and spa, plus 21,000
square feet of meeting space and 61,400 square feet of specialty retail. Patriot
is also acquiring 72 acres containing 99 separate residential parcels, to be
subdivided and sold over the next three years. Adjacent to The Boulders is a
1,000- acre residential community, with about 590 existing homes. 57 homes and
lots were sold in 1995.
The Boulders is the most awarded U.S. resort. In addition to the decade of
number-one ratings from "Andrew Harper's Hideaway Report," AAA has awarded The
Boulders its Five Diamond Award for eight consecutive years, and the property
has received two dozen additional awards in just the last few years.
THE PEAKS RESORT & SPAS. Surrounded on three sides by the 14,000 foot peaks of
Colorado's San Juan Mountain Range, the Peaks offers 177 oversized mountain view
guest rooms, 42,000 square feet of health spa and fitness facilities, pools,
plus squash and racquetball courts. All guest rooms offer ski-in/ski out access
to Telluride's premiere 1,050-acre ski area. Telluride features a 3,145-foot
vertical drop, some of the truly outstanding skiing in the Rockies. Adjacent to
The Peaks are golf, tennis and other recreational facilities available to Peaks
guests. The Peaks resort also has 26 penthouse condominiums plus 7,100 feet of
meeting space, additional residential properties and lots for development.
The Peaks offers heli-skiing and a variety of other exotic winter sports.
In the summer, mountain biking, llama treks and whitewater rafting round out a
range of challenging and once-in-a lifetime recreation opportunities. The Peaks
has won numerous recent industry awards, including AAA's Four Diamond Award,
Conde Nast Traveler's Readers Survey Top Ten, and others.
THE LODGE AT VENTANA CANYON. Situated on 1,100 acres in the high Sonoran Desert
outside of Tuscon, AZ, The Lodge at Ventura Canyon offers 50 spacious suites,
with plans to add 40 additional suites. The Lodge also offers two 18-hole Tom
Fazio-designed championship golf courses, 12 lighted tennis courts with a 3,000-
seat stadium court, and a spectacular swimming pool.
The Lodge at Ventana Canyon has won AAA Four Diamond Awards, Silver Medal Awards
from "Golf Digest" and ranks number one in "Lodging & Hospitality" magazine's
"400 Top Performers" resort ranking of revenues per room.
CARMEL VALLEY RANCH RESORT. Carmel Valley Ranch Resort, near Carmel, CA has 100
one-bedroom guest suites with approval to add 44 more. The resort is situated
on 1,700 acres of mountainside and valley acres, including 1,200 acres of
designated open space. Camel Valley includes an 18-hole Pete Dye championship
golf course, 12 tennis courts, two pools and fitness center. It also has 4,000
square feet of meeting space.
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Carmel Valley Ranch Resort has won 10 of the top resort industry awards in the
industry, many of these awards for multiple years, including the AAA Four
Diamond Award, Mobil Travel Guide's Four Star Award, and recognition from
magazines such as "Meetings & Conventions," "Conde Nast Traveler," "Andrew
Harper's Hideaway Report," and "World Tennis."
THE BUTTES. Carefree manages The Buttes on behalf of a third-party owner. With
353 rooms and concierge-level service, this Carefree Conference Resort, near
Tempe, AZ, has a strong reputation as a premiere corporate meeting destination.
The Buttes has ranked as a top occupancy leader among Phoenix-area resorts since
its opening in 1986. The property has 40,000 square feet of meeting space,
including a 140-seat amphitheater. Four lighted tennis courts, two pools, a
fitness center and full business center services appeal to executive tastes and
needs.
ABOUT RESORTS LIMITED PARTNERSHIP. Resorts Limited Partnership is an investment
partnership comprised of a number of institutional investors, whose interests
are managed by Aldrich Eastman & Waltch, a Boston-based real estate investment
advisor, and individuals related to Carefree Resorts.
ABOUT PATRIOT AMERICAN. Patriot's portfolio currently consists of 45 hotels,
primarily full-service, with 10,923 rooms. Patriot also has under contract four
other hotels, totaling 1,015 rooms. Major brands in Patriot's portfolio include
Crowne Plaza, Doubletree, Embassy Suites, Grand Heritage, Hilton, Holiday Inn,
Hyatt, Marriott, Radisson, Registry, Sheraton Four Points, WestCoast and
Wyndham. Patriot's professional asset management and focus on capital
reinvestment in properties are designed to create long-term growth from the
combination of improved operating performance and appreciation of real estate
value. The Company is aggressively seeking additional acquisitions in a number
of major markets throughout the U.S.
This press release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. The company's actual results could differ materially from
those set forth in the forward looking statements. Certain factors that might
cause such a difference include, but are not limited to, the company's
consummation of the acquisition of California Jockey Club and Bay Meadows
Operating Company.
FOR ADDITIONAL INFORMATION REGARDING PATRIOT AMERICAN FREE OF CHARGE VIA FAX,
DIAL 1-800-PRO-INFO AND USE THE COMPANY'S STOCK SYMBOL, "PAH."
