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Hilton Hotels, 1959 Annual Report
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Hilton Hotels Corporation. Hilton Hotels, 1959 Annual Report - Image 31. 1959. Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston. University of Houston Digital Library. Web. January 23, 2020. https://digital.lib.uh.edu/collection/hiltonar/item/1208/show/1202.

Disclaimer: This is a general citation for reference purposes. Please consult the most recent edition of your style manual for the proper formatting of the type of source you are citing. If the date given in the citation does not match the date on the digital item, use the more accurate date below the digital item.

Hilton Hotels Corporation. (1959). Hilton Hotels, 1959 Annual Report - Image 31. Annual Reports from the Hospitality Industry Archives. Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston. Retrieved from https://digital.lib.uh.edu/collection/hiltonar/item/1208/show/1202

Disclaimer: This is a general citation for reference purposes. Please consult the most recent edition of your style manual for the proper formatting of the type of source you are citing. If the date given in the citation does not match the date on the digital item, use the more accurate date below the digital item.

Hilton Hotels Corporation, Hilton Hotels, 1959 Annual Report - Image 31, 1959, Annual Reports from the Hospitality Industry Archives, Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston, accessed January 23, 2020, https://digital.lib.uh.edu/collection/hiltonar/item/1208/show/1202.

Disclaimer: This is a general citation for reference purposes. Please consult the most recent edition of your style manual for the proper formatting of the type of source you are citing. If the date given in the citation does not match the date on the digital item, use the more accurate date below the digital item.

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Compound Item Description
Title Hilton Hotels, 1959 Annual Report
Creator (LCNAF)
  • Hilton Hotels Corporation
Publisher Hilton Hotels Corporation
Date 1959
Description Hilton Hotels Annual Report for calendar year 1959.
Subject.Topical (LCSH)
  • Hospitality industry
  • Hotel management
  • Corporation reports
Subject.Name (LCNAF)
  • Hilton Hotels Corporation
Genre (AAT)
  • annual reports
  • business records
Language English
Type (DCMI)
  • Text
  • Image
Original Item Location Conrad N. Hilton Papers
Digital Collection Annual Reports from the Hospitality Industry Archives
Digital Collection URL http://digital.lib.uh.edu/collection/hiltonar
Repository Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston
Repository URL http://www.uh.edu/hilton-college/About/hospitality-industry-archives
Use and Reproduction No Copyright - United States
File Name index.cpd
Item Description
Title Image 31
Format (IMT)
  • image/jpeg
File Name hiltonar_201609_012_031.jpg
Transcript 7—COMMITMENTS AND CONTINGENT LIABILITIES The Company is committed to approximately $500,000 in connection with the construction of a new hotel. The Company has subscribed for and agreed to purchase from its wholly-owned subsidiary Hilton Hotels International, Inc., at par, $2,000,000 aggregate principal amount of 5% subordinated debentures, and 400,000 shares of $5.00 par value common stock to be issued from time to time at the option of the subsidiary. The commitment is irrevocable for a period of four years from November 27, 1956, but shall expire prior thereto if and when such securities in these amounts have been purchased by the Company. At December 31, 1959, Hilton Hotels Corporation, in connection with the subscription commitment, had purchased 320,000 shares of common stock and $200,000 face amount of debentures. During 1957 the Company, in connection with a lease and the construction of the Pittsburgh Hilton Hotel, entered into an Indenture of Mortgage and Deed of Trust pertaining to a $12,000,000 issue of Leasehold Mortgage 4-41/2% Sinking Fund Bonds due June 1, 1987. At December 31, 1959 $10,000,000 of the available funds had been drawn down by the Company. During 1959 the Company entered into a Credit Agreement with a banking institution providing for a loan of $25,000,000 to be advanced to the Company on or before September 15, 1961 with interest at the rate of 514% per annum. At December 31, 1959 the Company had not drawn any of the funds available under this agreement. The agreement provides for a commitment fee of Vi of 1% on the undrawn balance. A subsidiary, Metropolitan Hotel Corporation, entered into an agreement providing for a first mortgage construction loan in the amount of $5,000,000 of which $1,666,667 is to be guaranteed by the Company. At December 31, 1959 the subsidiary had not drawn any of the funds available under this agreement. Under the terms of an agreement with this subsidiary, the Company has agreed to purchase from time to time, as the subsidiary shall request, but not later than December 31, 1961, 99,000 additional shares of $1.00 par value common stock at an aggregate price of $499,000 and a 4% twenty-five year subordinated note of the subsidiary, in the principal amount of $1,500,000 at a price equal to said principal amount. The Company is guarantor to the extent of $1,000,000 under a $3,000,000 long-term obligation of this subsidiary. The Company has agreed to purchase all of the authorized capital stock of Hilton Inns, Inc. in the amount of $5,000,000. At December 31, 1959 the Company had purchased 120,000 shares of such stock at a cost of $1,200,000. The Company was contingently liable to the extent of approximately $4,700,000 as it did not receive releases from mortgagees under certain mortgages assumed by buyers of properties, who, however, agreed to hold the Company harmless against any liability thereon. As of July 15, 1959 the Company entered into an agreement with an individual to enable said individual to obtain sufficient financing to build an Inn to be leased by Hilton Inns, Inc. Under the agreement the Company might be required, by notice delivered between July 15 and July 25, 1960, to purchase the land and buildings to be constructed thereon at a purchase price of $2,600,000. The Company entered into an agreement dated September 12, 1958 with respect to the Hilton Inn at New Orleans, Louisiana, guaranteeing payment to the lessor, by Hilton Inns, Inc., of sufficient annual rental (not to exceed $192,000 per annum) to discharge debt service on the lessor's first mortgage, and guaranteeing payment by Hilton Inns, Inc. of real estate taxes and insurance premiums on the Inn. Hilton Inns, Inc. has an option, subject to certain conditions precedent, to purchase a tract of land, consisting of 10.61 acres, located in Dade County, Florida, for a purchase price of $848,800. The option expires on May 1, 1960 but may be extended by mutual agreement. 8—LONG-TERM LEASES The Company and its subsidiaries operate or will operate certain properties under leases ranging from three months to thirty-nine years five and one-half months from December 31, 1959, with options to renew for various periods in some instances. The total minimum annual fixed or basic rentals payable (exclusive of real estate taxes, insurance and other occupancy charges) under such leases for each of the next five years ending December 31, follows: 1960, $10,597,992; 1961, $10,147,992; 1962, $9,641,040; 1963, $9,299,233; and, 1964, $9,302,983. Rentals and other lease obligations of Hilton of Canada, Ltd., a wholly-owned subsidiary of Hilton Hotels International, Inc., operating the Queen Elizabeth Hotel in Montreal, are guaranteed by both "International" and by the Company. The Caribe Hilton lease was assigned to Caribe Hilton Hotel Corporation of Delaware, but, under the terms of the assignment, neither "International" nor the Company were relieved of their obligations under the lease agreement. "International" is also contingently liable for lease performance under all other leases entered into by or assigned to its foreign subsidiaries. The wholly-owned subsidiary, Hilton Hotels International, Inc. has entered into leases and contracts, subject to certain conditions, for the operation of hotels under construction or to be constructed in nine cities outside the continental United States. In general, "International" or its subsidiaries is required to furnish initial inventories and to maintain sufficient working capital, except in the case of one lease, which specifies that not less than $250,000 shall be furnished for these purposes, to be maintained for the first five years of the lease. In connection with hotels to be constructed in the Netherlands, "International"subscribed to 1,000,000 guilders ($265,000) in the share capital of the landlord companies. The terms of the leases commence either on actual occupancy or within ten days of receipt of architect's certificate of occupancy. The leases basically provide for a rental based on a percentage of gross operating profit with certain specific rental obligations. 9—LIMITATIONS AND RESTRICTIONS Under the most restrictive covenants of certain indentures relating to long-term debt of the Company and an affiliate as of December 31, 1959, the Company and certain subsidiaries on a consolidated basis was (a) required to maintain working capital of not less than $6,000,000 and a ratio of current assets to current liabilities of not less than 120%; and (b) prohibited from declaring cash dividends on its capital stock, purchasing, redeeming or otherwise retiring any shares of its capital stock unless the sum of $2,500,000 and 80% of the consolidated net income from January 1, 1957 to date of declaration shall be greater than the aggregate of all such dividends and payments. The maximum amount of earned surplus so restricted was $55,214,047 at December 31,1959. Under the most restrictive covenants of certain long-term obligations of the wholly-owned subsidiary, Hilton Hotels International, Inc., the subsidiary is obligated to (a) maintain consolidated working capital of not less than $1,250,000, one-half thereof to be represented by assets located in the United States, its territories and possessions, or in countries whose currencies are readily,and favorably convertible into dollars; and, (b) prohibited from declaring dividends, other than in its own stock, and from reacquiring its own stock for consideration. 29