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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________________ to _____________________
Commission file number 0-9032
SONESTA INTERNATIONAL HOTELS CORPORATION
-----------------------------------------
(Exact name of registrant as specified in its charter)
NEW YORK 13-5648107
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 Clarendon Street, Boston, Massachusetts 02116
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 421-5400
Securities registered pursuant to Section 12 (b) of the Act:
NONE
(Title of Class)
Securities registered pursuant to Section 12 (g) of the Act:
Title of each class Name of each exchange on which registered
Class A Common Stock
$ .80 par value NASDAQ
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes No X
--- ---
See Form 12b-25 filed June 30, 1997.
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K (ss.229,405 of this chapter) 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. [X]
The aggregate market value of the common stock held by non-affiliates
of the registrant as of the close of business on March 16, 1998 was $9,780,507.
The number of shares outstanding of the registrant's common stock as of
the close of business on March 16, 1998 was 2,068,215.
Documents incorporated by reference
1. Portions of the annual report to shareholders for the year ended
December 31, 1997 are incorporated by reference into Parts I, II and IV.
2. Portions of the proxy statement for the 1998 annual meeting of
stockholders are incorporated by reference into Part III.
An Index to Exhibits appears on pages 12 through 20 of this Form 10-K.
- --------------------------------------------------------------------------------
PART I
Item 1. Business
(a) General Development of Business: The Company is engaged in the
operation of hotels that it owns or leases in Boston (Cambridge),
Massachusetts; New Orleans, Louisiana; and Anguilla, B.W.I. It also
operates, under management agreements, hotels in Southampton, Bermuda;
Curacao, Netherlands Antilles; Key Biscayne, Florida; New Orleans,
Louisiana; and Cairo, Luxor, El Gouna, Port Said and Sharm el Sheikh,
Egypt; and two Nile River cruise vessels. The Company has paid $2
million for a 22% ownership interest in the hotel and casino it
operates under a management contract in Curacao, Netherlands Antilles.
The Company has entered into management agreements to operate new
hotels being created in Miami Beach; Taba and Nuweiba, Egypt; and
Manama, Bahrain; the Manama hotel is expected to open later this year,
the other projects are scheduled to open in 1999 or 2000. The Company
also licenses the use of the Sonesta name to two operating hotels in
Aruba. The Company terminated contracts under which it operated two
properties in Hurghada, Egypt, effective in early January 1998; and a
license agreement for a hotel in Santiago, Chile was terminated
effective at the end of February 1998. In November 1995, the Company
acquired the 100-room resort in Anguilla, B.W.I., known as Casablanca
Resort, which at that time was closed due to damage from Hurricane
Luis, in September 1995. (For details of this transaction, reference is
made to Note 2-Operations, on page 13 of the 1997 Annual Report to
Shareholders.) In December 1994 the Company entered into two
partnerships: one involving an 82-room hotel in Soho, New York; the
other to create a 320-room resort in Costa Rica. In July, 1996, the
Company liquidated its investment in the Soho project, and in March
1997 the Company notified its partner in the Costa Rica project that it
was terminating its participation in that project. Through a
foreclosure procedure the Company now owns the resort site in Costa
Rica.
(b) Not applicable.
(c) Narrative Description of Business: The Company's business is to a great
extent dependent upon a high level of economic activity.
The hotel business is highly competitive. The facilities of competitors
are often affiliated with national or regional chains having more room
accommodations and greater financial resources than the Company. The
Company follows the practice of refurnishing and redecorating the
hotels which it operates in order to keep the properties attractive and
competitive with new hotel properties, and this requires the Company to
make substantial capital expenditures. During the two years ended
December 31, 1997, the Company made capital expenditures for its hotels
totaling approximately $13,700,000.
The Company endeavors to create individual and distinctive features for
each hotel property while utilizing common corporate identification in
order to obtain the benefits of chain operation. The Company is using
the name "Sonesta" for all of its hotels.
2
Item 1. Business
(c) (Cont'd)
The Company has approximately 1,538 employees. Approximately 256 of
these employees are covered by a collective bargaining agreement. The
Company considers its relations with its employees to be satisfactory.
While the business of the Company's individual hotels is seasonal, the
diverse locations of the three owned or leased properties tend to
mitigate the impact of this factor. Traditionally, the second and
fourth quarters have produced greater revenues and operating income
than the first and third quarters, although these seasonal fluctuations
do not materially affect the Company's business activities.
The following table provides total revenues, annual occupancy
percentage, average room rate and revenue per available room ("REVPAR")
for the Company's owned and leased properties for the years 1997, 1996
and 1995. REVPAR is calculated by dividing annual room revenue by the
total number of rooms available during the year. The Sonesta Beach
Resort Anguilla was acquired by the Company in November 1995 and opened
on January 18, 1996.
TOTAL
NUMBER OF YEAR BUILT REVENUES
HOTEL ROOMS OR ACQUIRED (in thousands)
- ----- ----- ----------- -------------------------------------------------
1997 1996 1995
---- ---- ----
Sonesta Beach Resort Anguilla, Owned 100 1995 $4,071 $2,717 --
B.W.I.
Royal Sonesta Hotel Boston Owned 400 1963/1984 25,521 22,891 $20,969
(Cambridge)
Royal Sonesta Hotel New Orleans Leased 500 1969 31,491 30,802 29,318
AVERAGE AVERAGE
OCCUPANCY DAILY
PERCENTAGE RATE
----------------------------------------- ------------------------------------------------
HOTEL 1997 1996 1995 1997 1996 1995
- ----- ---- ---- ---- ---- ---- ----
Sonesta Beach Resort Anguilla, 48.8% 39.3% -- $192 $147 --
B.W.I.
Royal Sonesta Hotel Boston 76.2% 76.5% 76.2% 144 127 $118
(Cambridge)
Royal Sonesta Hotel New Orleans 79.1% 80.5% 79.6% 147 141 136
"REVPAR"
------------------------------------
HOTEL 1997 1996 1995
- ----- ---- ---- ----
Sonesta Beach Resort Anguilla, B.W.I. $ 94 $ 58 --
Royal Sonesta Hotel Boston (Cambridge) 109 97 $ 90
Royal Sonesta Hotel New Orleans 117 114 108
3
Item 1. Business
(c) (Cont'd)
The Company has established and maintains trademark protection for
certain service marks it uses in conducting its business, including the
service marks "Sonesta", "Sonesta Beach", "Just Us Kids", and the
Company's stylized "S" logo. Trademarks are maintained in numerous
countries, besides the United States. Each mark is generally protected
for several years, subject to periodic renewal.
For revenues by class of service for the three years ended December 31,
1997, reference is made to the Consolidated Statements of Operations
which appears on page 7 of the 1997 Annual Report to Shareholders.
(d) Financial Information about Foreign and Domestic Operations: This
information is incorporated by reference to Note 2 on pages 13 through
15 of the 1997 Annual Report to Shareholders.
Item 2. Properties
The Company's hotels are primarily metropolitan and resort hotels in popular
vacation areas which emphasize luxury accommodations and personal service.
The Company has fee ownership in two hotels: Royal Sonesta Hotel, Boston
(Cambridge), Massachusetts and Sonesta Beach Resort Anguilla, B.W.I. Reference
is made to Note 6 of the Notes to the Consolidated Financial Statements of the
registrant which appears on pages 16 and 17 of the Company's 1997 Annual Report
to Shareholders for details of the mortgage liens on the Boston (Cambridge),
Massachusetts property and the Anguilla property.
The Company operates the Royal Sonesta Hotel, New Orleans, Louisiana under a
long-term lease which expires on September 30, 2024, provided the Company
exercises its two ten-year extension options.
The Company also operates under management agreements hotels in Southampton,
Bermuda; Curacao, Netherlands Antilles; Key Biscayne, Florida; New Orleans,
Louisiana; and Cairo, Luxor, El Gouna, Port Said and Sharm el Sheikh, Egypt; and
two Nile River cruise vessels. The Company's hotel and casino on the island of
Curacao is operated under a management contract, and the Company has invested $2
million for a 22% ownership interest in that property. The company has granted
licenses for the use of its name to two hotels in Aruba.
In December 1994, the Company entered into two partnerships: one of the
partnerships was formed to acquire and develop as a hotel, including retail
space, a building in the SoHo district of New York; the other partnership was
formed to acquire a beachfront hotel site in Guanacaste, Costa Rica on which the
partnership intended to develop a 320-room resort and casino. The Company
liquidated its investment in the Soho project in July 1996. The Company notified
its
4
development partner that it did not intend to proceed with the Costa Rica
project, in which a Company subsidiary was a 50% partner, triggering the
repayment of certain funds advanced by the Company and secured by a mortgage.
Those funds were not repaid and the Company foreclosed on the mortgage and now
holds fee ownership of the development site in Costa Rica.
In addition to the properties listed above, the Company leases space for its
executive offices at 200 Clarendon Street, Boston, Massachusetts 02116.
Item 3. Legal Proceedings
A wholly-owned subsidiary of the Company, Sonesta Hotels of Anguilla Limited
("SHAL"), and two executive officers of the Company were named as defendants in
a lawsuit filed in October, 1997, in Anguilla, B.W.I., by the former owner of
the resort hotel in Anguilla which the subsidiary purchased in November 1995
(the "Resort"), and the principals of that entity. The Statement of Claim in
this lawsuit, which was substantially amended in January 1998, alleges, inter
alia, that the defendants have not complied with certain "implied terms" of the
agreements between them and with the terms of an alleged oral agreement. The
plaintiffs in this action are seeking relief from their contractual obligations,
entitlement to certain financial benefits, and certain equitable relief. In late
February 1998 defendants filed a "Defense and Counterclaim" to plaintiffs'
"Amended Statement of Claim". The parties have engaged in settlement discussions
which to date have not been fruitful. In the absence of a settlement SHAL
expects to vigorously defend against this action, and to vigorously prosecute
its counterclaims, and expects a favorable outcome.
In early 1997, SHAL filed a lawsuit in The Court of First Instance, in Curacao,
Netherlands Antilles, against the company that was insuring the Resort at the
time of Hurricane Luis, in September 1995. In the suit, SHAL seeks to establish
its entitlement to business interruption coverage for periods subsequent to the
date SHAL acquired ownership of the Resort. The insurer, Ennia Caribe Schade
N.V., has taken the position that (1) it has no obligation to fund business
losses realized after the date of sale, and (2) the applicable policy does not
recognize business losses incurred after the Resort was restored and reopened.
The Company expects to vigorously pursue its claims against Ennia Caribe, but it
is not able to predict with certainty how this lawsuit will be resolved.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of shareholders of the Company in the fourth
quarter of 1997.
5
PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
Common stock market prices and dividends and the number of shareholders of
record are incorporated by reference to page 2 of the 1997 Annual Report to
Shareholders.
A dividend of $ .15 per share was paid on the Company's common stock in July
1996 and a dividend of $ .15 per share was declared on the Company's common
stock in December 1996, but was paid in January 1997. A dividend of $ .15 per
share was paid on the Company's common stock in July 1997 and a dividend of $
.15 per share was declared on the Company's common stock in December 1997, but
was paid in January 1998. Other information required by this item is
incorporated by reference to the Consolidated Statements of Stockholders' Equity
which appears on page 10 of the 1997 Annual Report to Shareholders.
No dividends may be declared or paid on the Company's common stock nor may
common stock be purchased or redeemed unless (a) preferred stock dividend and
sinking fund requirements are met; and (b) the total of dividends paid does not
exceed the maximum amount permitted by one of the Company's bank loan
agreements.
Item 6. Selected Financial Data
Selected Financial Data, on page 2 of the 1997 Annual Report to Shareholders, is
incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Results of Operations and
Financial Condition
This information is incorporated by reference to pages 3 through 5 of the 1997
Annual Report to Shareholders.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
This Item does not apply to the Company.
Item 8. Consolidated Financial Statements and Supplementary Data
The financial statements listed in the Index to Consolidated Financial
Statements filed as part of this Annual Report on Form 10-K, together with the
report of Ernst & Young LLP dated March 13, 1998, are incorporated herein by
reference to the 1997 Annual Report to Shareholders.
Selected Quarterly Financial Data, on page 5 of the 1997 Annual Report to
Shareholders, is incorporated by reference.
6
Item 9. Changes in and Disagreements with Auditors on Accounting and Financial
Disclosure
There were no disagreements with auditors on accounting principles or practices
or financial statement disclosures.
PART III
Item 10. Directors and Executive Officers of the Registrant
A. Directors of the Company and Compliance with Section 16 (a)
The information required by this item is incorporated herein by
reference to the proxy statement for the 1998 Annual Meeting of
Stockholders.
B. The Executive Officers of the Company are as follows
Employment History
Name Present Position Age 1993 to Present
- ---- ---------------- --- ---------------
Roger P. Sonnabend Chairman of the Board and Chief 72 Chairman and Chief Executive Officer.
Executive Officer
Stephanie Sonnabend President 45 Vice President - Marketing until
November 1993, then Executive Vice
President until January 1, 1996.
Paul Sonnabend Chairman of the Executive Committee 70 President until December 31, 1995.
and Chief Financial Officer
Stephen Sonnabend Senior Vice President 66 Senior Vice President.
Boy van Riel Vice President and Treasurer 39 Controller until March 1993, then
Vice President & Treasurer.
Peter J. Sonnabend Vice Chairman, Vice President and 44 Vice President and Secretary until
Secretary May 1995.
Christopher Baum Vice President - Sales & Marketing 44 Vice President - Sales & Marketing.
7
Employment History
Name Present Position Age 1993 to Present
- ---- ---------------- --- ---------------
Michael Levie Vice President - Egypt 37 Vice President & General Manager,
Royal Sonesta Hotel, Boston
(Cambridge), until January 1996.
Felix Madera Vice President - International 49 Vice President & General Manager,
Sonesta Beach Resort, Key Biscayne,
Florida.
Mary Jane Rosa Vice President - Design 49 Director of Design until January
1993, then Vice President - Design.
Jacqueline Sonnabend Executive Vice President 43 Vice President - Human Resources
until March 1996.
Hans Wandfluh Vice President 63 President & General Manager, Royal
Sonesta Hotel, New Orleans,
Louisiana.
Roger, Paul and Stephen Sonnabend are brothers. Stephanie Sonnabend and
Jacqueline Sonnabend are the daughters of Roger Sonnabend. Peter J. Sonnabend is
the son of Paul Sonnabend.
The Board of Directors elects officers of the Company on an annual basis.
Item 11. Executive Compensation
and
Item 12. Security Ownership of Certain Beneficial Owners and Management
and
Item 13. Certain Relationships and Related Transactions.
The information required by these items is incorporated by reference to the
proxy statement for the 1998 Annual Meeting of Stockholders to be held on May
18, 1998.
8
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) 1. Financial Statements: The financial statements listed in the
accompanying Index to Consolidated Financial Statements is filed as
part of this Annual Report.
2. Financial Statement Schedules: The schedule listed in the
accompanying Index to Consolidated Financial Statements is filed as
part of this Annual Report.
3. Financial Statements of significant subsidiary, RIF Resort Hotel,
N.V., if available, shall be provided by amendment to this Form 10-K
by June 30, 1998, as allowed under Regulation S-X, Rule 3-09.
4. Exhibits: The exhibits listed on the accompanying Index to Exhibits
are filed as part of this Annual Report.
(b) Reports on Form 8-K filed during the last quarter of 1997: None
9
SONESTA INTERNATIONAL HOTELS CORPORATION
Index to Consolidated Financial Statements
and Financial Statement Schedules
Item 14 (a) (1) and (2) References (Page)
1997 Annual Report to
Form 10-K Shareholders*
--------- -------------
Consolidated Balance Sheets
at December 31, 1997 and 1996 ........... 8-9
For the years ended December 31,
1997, 1996 and 1995:
Consolidated Statements of
Operations .................. 7
Consolidated Statements of
Stockholders' Equity ........... 10
Consolidated Statements of
Cash Flows .......................... 11
Notes to Consolidated
Financial Statements ..................... 12-20
Consolidated Financial Statement
Schedule for the year ended
December 31, 1997:
II. Consolidated Valuation and
Qualifying Accounts ............ 11
All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable and therefore have been omitted.
- -------------------------------------------------
*Incorporated by Reference
10
SONESTA INTERNATIONAL HOTELS CORPORATION
SCHEDULE II - CONSOLIDATED VALUATION AND QUALIFYING ACCOUNTS
THREE YEARS ENDED DECEMBER 31, 1997
AMOUNTS AMOUNTS
BALANCE, CHARGED (WRITTEN OFF) BALANCE,
BEGINNING (CREDITED) NET OF END OF
OF YEAR TO INCOME RECOVERIES YEAR
------- --------- ---------- ----
Year Ended December 31, 1995
Deducted from assets:
Valuation reserve on long-term
receivables and advances $ 5,500,000 $ - $ - $ 5,500,000
=========== ========== ========== ===========
Allowance for doubtful accounts $ 84,249 $ 26,400 $ (12,748) $ 97,901
=========== ========== ========== ===========
Year Ended December 31, 1996
Deducted from assets:
Valuation reserve on long-term
receivables and advances $ 5,500,000 $ - $ - $ 5,500,000
=========== ========== ========== ===========
Allowance for doubtful accounts $ 97,901 $ 37,650 $ (27,577) $ 107,974
=========== ========== ========== ===========
Year Ended December 31, 1997
Deducted from assets:
Valuation reserve on long-term
receivables and advances $ 5,500,000 $ - $ - $ 5,500,000
=========== ========== ========== ===========
Allowance for doubtful accounts $ 107,974 $ 26,001 $ (16,317) $ 117,658
=========== ========== ========== ===========
==========================================================================================================
11
Sonesta International Hotels Corporation
Index to Exhibits
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
3.1 Certificate of Incorporation as amended to date. (8)
3.2 Company By-laws, including all amendments through March
16, 1998. (12)
9.1(a) Sonnabend Voting Trust Agreement dated August 1, 1984,
providing for the combination of the voting power of
stock held by members of the Sonnabend Family. (6)
9.1(b) First Amendment dated December 1984 to Sonnabend Voting
Trust Agreement (6)
10.1(a) "Third Amendment of Mortgage and Security Agreement and
Second Amendment of Note" Between Key Biscayne Limited
Partnership, Mortgagor ("KBLP") and Florida Sonesta
Corporation, Mortgagee ("FSC"), dated February 4, 1994.
(10)
10.1(b) "Operating Deficit Loan Mortgage Note" ($2,194,005.00)
from KBLP to FSC, dated as of December 31, 1993. (10)
10.1(c) "Operating Deficit Loan Mortgage and Security Agreement"
between KBLP and FSC, dated February 4, 1994. (10)
10.1(d) "Promissory Note" ($1,576,600.00) from KBLP to FSC,
dated February 4, 1994 . (10)
10.1(e) "Second Amendment to Management Agreement" dated as of
December 31, 1993 between KBLP and FSC. (10)
12
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.2(a) Renovation Enhancement Agreement, dated February 19,
1993, between Florida Sonesta Corporation ("FSC") and
Key Biscayne Limited Partnership ("KBLP"). (9)
10.2(b) First Amendment to Renovation Enhancement Agreement,
dated May 18, 1993, between FSC and KBLP. (9)
10.3 Second Renovation Enhancement Agreement, dated April 30,
1993, between FSC and KBLP. (9)
10.4(a) "Sonesta Loan" agreement, dated April 13, 1993 between
FSC and KBLP. (9)
10.4(b) First Amendment to "Sonesta Loan" agreement, dated
September 29, 1993, between FSC and KBLP. (9)
10.5(a) "Renovation Agreement", dated September 12, 1991,
between Florida Sonesta Corporation ("FSC") and Key
Biscayne Limited Partnership ("KBLP"). (7)
10.5(b) "First Amendment to Management Agreement", dated
September 12, 1991, between FSC and KBLP. (7)
10.5(c) "Amendment of Note and Second Mortgage", dated September
12, 1991, between FSC and KBLP. (7)
10.5(d) "Amendment of Note and Third Mortgage", dated September
12, 1991, between FSC and KBLP. (7)
10.6(a) "1995 Loan Agreement" between Hibernia National Bank
("Hibernia") and Royal Sonesta, Inc. ("Royal Sonesta"),
as of January 1, 1995. (10)
10.6(b) "Promissory Note" ($5,000,000) from Royal Sonesta to
Hibernia, dated "Effective January 1, 1995". (10)
13
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.6(c) "First Amendment to 1995 Loan Agreement" Between
Hibernia and Royal Sonesta, dated December 12, 1994.
(10)
10.6(d) "Second Amendment to 1995 Loan Agreement" Between 23-34
Hibernia and Royal Sonesta, dated as of December
31, 1997.
10.6(e) "Second Modification to Promissory Note" Between Hibernia and 25
Royal Sonesta, dated as of December 31, 1997.
10.7(a) 1992 Loan Agreement, dated December 30, 1992, between
Royal Sonesta, Inc. and Hibernia National Bank in New
Orleans. (8)
10.7(b) Promissory Note, dated December 30, 1992 between Royal
Sonesta, Inc. and Hibernia National Bank in New Orleans.
(8)
10.7(c) Restatement and Continuation of Continuing Guaranty,
dated December 30, 1992, between the Registrant and
Hibernia National Bank in New Orleans. (8)
10.8(a) "Amendment and Restatement of the Amended and Restated
Loan Agreement", dated December 23, 1991, between
Hibernia National Bank, Royal Sonesta, Inc. and Sonesta
International Hotels Corporation. (7)
10.8(b) $2,875,000 Promissory Note, dated December 23, 1991,
from Royal Sonesta, Inc. to Hibernia National Bank. (7)
10.9(a) Promissory Note ($22,880,000), dated December 18, 1996,
from the Trustees of Charterhouse of Cambridge Trust
("Trust") and Sonesta of Massachusetts, Inc. ("Sonesta
Mass") to SunAmerica Life Insurance Company
("SunAmerica"). (13)
14
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.9(b) Mortgage, Security Agreement, Fixture Filing, Financing
Statement and Assignment of Leases and Rents, dated as
of December 18, 1996, between Trust and Sonesta Mass,
and SunAmerica. (13)
10.9(c) Environmental Indemnity Agreement, dated as of December
18, 1996, between Trust, Sonesta Mass, and Sonesta
International Hotels Corporation ("Sonesta"), and
SunAmerica. (13)
10.9(d) Escrow Agreement, dated as of December 18, 1996, between
Trust and Sonesta Mass, SunAmerica, "Escrow Agent". (13)
10.9(e) Replacement Reserve and Security Agreement, dated as of
December 18, 1996, between Trust and Sonesta Mass, and
SunAmerica. (13)
10.9(f) Limited Guaranty Agreement, dated as of December 18,
1996, between Sonesta and SunAmerica. (13)
10.10(a) "Contract of Sale", dated July 11, 1996, between The
Soho Hotel Company, L.P. ("Soho") and The Mercer I
L.L.C. ("Mercer I"). (13)
10.10(b) "Lease Assignment and Assumption", dated July 11, 1996,
between Soho and Mercer I. (13)
10.10(c) "Assignment and Assumption of Assumed Contracts", dated
July 11, 1996, between SoHo and Mercer I. (13)
10.10(d) "Indemnity Agreement", dated July 11, 1996, between Soho
and Andre Balazs. (13)
10.11 "Shareholders Agreement of C.R. Resort Associates
Limited", dated December 8, 1994. (10)
10.12(a) First Amendment to Shareholders Agreement of C.R. Resort
Associates Limited, dated September 18, 1996. (13)
15
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.12(b) Agreement, dated September 18, 1996, between El Cacique
de Calzon de Pobre, S.A.; Extency Internacional S.A.;
Investex, S.A.; Sonesta International Hotels Limited;
Sonesta International Hotels Corporation; Costa Rica
Resort Associates, S.A. (13)
10.13(a) Revolving Term Note ($2,000,000) from Sonesta
International Hotels Corporation to USTrust, dated
September 30, 1995. (12)
10.13(b) Commitment Letter agreement, dated September 28, 1995,
between Sonesta International Hotels Corporation and
USTrust. (12)
10.14 Letter Agreement extending the maturity date of the 26-29
Commercial Promissory Note ($2,000,000) from Sonesta
International Hotels Corporation to USTrust, dated September
30, 1997.
10.15(a) Loan Agreement dated ($1,000,000), dated December 18,
1996, between Masters of Tourism and Sonesta
International Hotels Limited. (13)
10.15(b) (Personal) Guaranty of Hisham Aly, dated as of December
18, 1996. (13)
10.16 Loan Agreement ($277,935) dated as of January 1, 1997,
between Masters of Tourism and Sonesta International
Hotels Limited (consolidating two (2) outstanding loan
balances). (13)
10.17(a) "Amendment to Loan Agreement", dated April 29, 1997, between 30-33
Masters of Tourism and Sonesta International Hotels Limited.
10.17(b) (Personal) Guaranty of Hisham Aly, dated as of April 29, 1997. 34-37
10.18 "Third Amendment to Lease" between John Hancock and
Sonesta, dated June, 1994. (10)
16
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.19 "Second Amendment to Lease" between John Hancock Mutual
Life Insurance Company ("John Hancock") and Sonesta
International Hotels Corporation ("Sonesta"), dated
March 22, 1994. (10)
10.20 Indenture of Lease, dated June 26, 1979, between John
Hancock Mutual Life Insurance Company and Sonesta
International Hotels Corporation. (4)
10.21(a) Intercreditor, Payment Priority and Lien Priority
Agreement, dated as of September 15, 1993, between
Sonesta International Hotels Corporation ("Sonesta"),
Sonesta Louisiana Hotels Corporation ("SLHC"), 800 Canal
Street Limited Partnership (the "Partnership"), and
numerous other parties. (9)
10.21(b) Commercial Guaranty, dated September 15, 1993, by SLHC
and Sonesta. (9)
10.21(c) CSDC/Manager Reserve Agreement, dated September 15,
1993, between SLHC, the Partnership and Canal Street
Development Corporation. (9)
10.22(a) Manager Advance Agreement, dated as of May 6, 1997, between 38-42
SLHC and the Partnership.
10.22(b) Term Note ($500,000) from the Partnership to SLHC, dated May 43
6, 1997.
10.22(c) Collateral Note ($650,000) from the Partnership to SLHC, 44
dated May 6, 1997.
10.22(d) Commercial Guaranty, dated May 6, 1997, between SLHC, 45-49
Sonesta, and First National Bank of Commerce.
10.22(e) Amended and Restated Intercreditor, Payment Priority and Lien 50-102
Priority Agreement, dated as of May 6, 1997, between Sonesta,
SLHC, the Partnership, and numerous other parties.
17
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.23 Extension of Lease by Royal Sonesta, Inc., dated August
6, 1993. (9)
10.24 Agreement, dated September 9, 1993, between Royal
Sonesta, Inc. and Aetna Life Insurance Company (9)
10.25 Hotel Lease-Amendment No. 3, dated September 17, 1981,
between Aetna Life Insurance Company and Royal Sonesta,
Inc. (5)
10.26 Hotel Lease-Amendment No. 2, dated September 1, 1977,
between Chateau Louisiane, Inc. and Royal Sonesta, Inc.
(3)
10.27 Hotel lease-Amendment No. 1, dated November 26, 1973,
between Chateau Louisiane, Inc. and Louisiana Sonesta
Corporation. (2)
10.28 Hotel Lease, dated December 12, 1967, between Chateau
Louisiane, Inc., as "Landlord", and The Royal Orleans,
Inc., as "Tenant". (1)
10.29(a) Restated Employment Agreement, dated January 1, 1992,
between the Registrant and Paul Sonnabend, together with
letter agreement regarding permanent and total
disability. (8) (Management contract under Item 601 (10)
(iii) (A))
10.29(b) Restated Employment Agreement, dated January 1, 1992,
between the Registrant and Roger P. Sonnabend, together
with letter agreement regarding permanent and total
disability. (8) (Management contract under Item 601 (10)
(iii) (A)).
10.29(c) Restated Employment Agreement, dated January 1, 1992,
between the Registrant and Stephen Sonnabend together
with letter agreement regarding permanent and total
disability. (8) (Management contract under Item 601 (10)
(iii) (A)).
18
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
10.30 (Letter) Loan Agreement ($2,000,000), dated July 18,
1996, between Maduro & Curiel's Bank N.V. and Sonesta
Curacao Hotel Corporation N.V. (13)
10.31 Lease, dated September 21, 1991, between "the Crown" and
Casablanca Resorts Development of Anguilla Limited
("CRDAL") (assumed by Sonesta Hotels of Anguilla Limited
("Sonesta Anguilla") in November 1995). (11)
10.32 Debenture, dated November 28, 1995, between Scotiabank
Anguilla Limited and Sonesta Anguilla (11)
10.33 Debenture ($6,390,000) from Sonesta Hotels of Anguilla
Limited to Scotiabank Anguilla Limited, dated December
1996 (evidencing additional $1,700,000 loan). (13)
10.34 Agreement, dated as of March 1, 1996, between CRDAL and
Sonesta Anguilla. (13)
10.35 (Letter) Loan Agreement ($1,000,000), dated February 9,
1997, between Sakkara Hotels and Sonesta International
Hotels Corporation. (13)
10.36 (Letter) Lease Agreement, dated June 3, 1996, between
Sonesta Hotels of Anguilla, Ltd. and Amsterdam Sonesta
Corporation (subsequently renamed Anguilla Hotel
Management, Inc.) (13)
10.37 Loan Agreement, dated July 30, 1997, between Sonesta Miami 103-112
Beach Hotel Company, Inc. and Skip Properties N.V.
13 Annual Report to Security Holders for the calendar year ended 113-133
December 31, 1997.
21 Subsidiaries of the Registrant. 134
23 Consent of Ernst & Young LLP filed herewith. 135
19
NUMBER DESCRIPTION PAGE NOS.
- ------ ----------- ---------
27 Financial Data Schedule 136
(1) Incorporated by reference to the Company's 1967 Report on Form 10-K.
(2) Incorporated by reference to the Company's 1973 Report on Form 10-K.
(3) Incorporated by reference to the Company's 1977 Report on Form 10-K.
(4) Incorporated by reference to the Company's 1979 Report on Form 10-K.
(5) Incorporated by reference to the Company's 1981 Report on Form 10-K.
(6) Incorporated by reference to the Company's 1984 Report on Form 10-K.
(7) Incorporated by reference to the Company's 1991 Report on Form 10-K.
(8) Incorporated by reference to the Company's 1992 Report on Form 10-K.
(9) Incorporated by reference to the Company's 1993 Report on Form 10-K.
(10) Incorporated by reference to the Company's 1994 Report on Form 10-K.
(11) Incorporated by reference to the Company's 1995 Report on Form 8-K.
(12) Incorporated by reference to the Company's 1995 Report on Form 10-K.
(13) Incorporated by reference to the Company's 1996 Report on Form 10-K.
20
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
and Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
SONESTA INTERNATIONAL HOTELS CORPORATION
(Registrant)
By: /S/ Date: March 16, 1998
-------------------------------------------------
Boy van Riel
Vice President and Treasurer
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 dates indicated.
By: /S/ Date: March 16, 1998
--------------------------------------------------
Roger P. Sonnabend
Chairman of the Board and Chief Executive Officer
By: /S/ Date: March 16, 1998
--------------------------------------------------
Boy van Riel
Vice President and Treasurer, Principal
Financial and Accounting Officer
By: /S/ Date: March 16, 1998
--------------------------------------------------
Paul Sonnabend
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
Peter J. Sonnabend
Director
21
By: /S/ Date: March 16, 1998
--------------------------------------------------
Stephanie Sonnabend
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
Stephen Sonnabend
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
George S. Abrams
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
Vernon R. Alden
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
Joseph L. Bower
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
Lawrence M. Levinson
Director
By: /S/ Date: March 16, 1998
--------------------------------------------------
Jean C. Tempel
Director
22