SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________________to_______________________
Commission file number 033-73340-01
John Q. Hammons Hotels, L.P. 401(k) Plan
John Q. Hammons Hotels, Inc.
300 John Q. Hammons Parkway, Suite 900
Springfield, MO 65806
John Q. Hammons Hotels, L.P.
401(k) Plan
Financial Statements
As of
December 31, 1996
Together With
Auditors' Report
John Q. Hammons Hotels, L.P.
401(k) Plan
Index
Page(s)
Report of Independent Public Accountants 1-2
Statement of Net Assets Available for Plan Benefits
with Fund Information 3
Statement of Changes in Net Assets Available for
Plan Benefits with Fund Information 4
Notes to Financial Statements 5-9
Schedule of Assets Held for Investment Purposes 10
Schedule of Reportable Transactions 11
Report of Independent Public Accountants
To the Trustees of
John Q. Hammons Hotels, L.P.
401(k) Plan:
We have audited the accompanying statement of net assets available
for plan benefits, with fund information of the JOHN Q. HAMMONS HOTELS, L.P.
401(k) PLAN as of December 31, 1996 and the related statement of changes in
net assets available for plan benefits, with fund information for the year
then ended. These financial statements and the schedules referred to below
are the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements and schedules based on our
audit.
We conducted our audit 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
misstatements. 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 audit provides a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for plan benefits,
with fund information of the John Q. Hammons Hotels, L.P. 401(k) Plan as of
December 31, 1996 and the changes in its net assets available for plan
benefits, with fund information for the year then ended in conformity with
generally accepted accounting principles.
Our audit was performed for the purpose of forming an opinion on
the basic financial statements taken as a whole. The supplemental schedules
of assets held for investment purposes and reportable transactions are
presented for the purpose of additional analysis and are not a required part
of the basic financial statements but are supplementary information required
by the Department of Labor Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974. The
fund information in the statement of net assets available for plan benefits
and the statement of changes in net assets available for plan benefits is
presented for purposes of additional analysis rather than to present the net
assets available for plan benefits and changes in net assets available for
plan benefits of each fund. The supplemental schedules have been subject to
the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, are fairly stated, in all material respects,
in relation to the basic financial statements taken as a whole.
Cincinnati, Ohio,
July 9, 1997.
John Q. Hammons Hotels, L.P.
401(k) Plan
Statement of Net Assets Available for Plan Benefits with Fund Information
As of December 31, 1996
Fund Information
Participant-directed
<TABLE>
<CAPTION>
John Q. Merrill Davis AIM Merrill
Hammons Lynch New York Constell Lynch
Hotels, Inc. Retirement Venture ation Growth
Common Preservation Fund Fund Fund
Stock Trust
<S> <C> <C> <C> <C> <C>
Cash $ 575 $ $ $ $
Investments
at market value
Mutual Funds 78,213 116,345 289,604 235,576
Common stock 60,116
RECEIVABLES
Accrued income
Employee
contributions 1,506 2,126 2,954 7,336 2,710
Employer
contributions 577 891 1,161 2,794 1,059
Total assets 62,774 81,230 120,460 299,734 239,345
LIABILITIES
Excess
employee
contributions (5,930) (1,586) (8,163) (15,943) (12,929)
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $56,844 $79,644 $112,297 $283,791 $226,416
</TABLE>
Statement of Net Assets Available - continuation
Non-Participant
Directed
<TABLE>
<CAPTION>
Merrill Merrill
Lynch Basic Lynch
Value Fund Corporate
Bond Fund Cash Fund Total
<S> <C> <C> <C> <C> <C>
Cash $ $ $ 108 $ 683
Investments
at market value
(note 2)
Mutual funds 112,607 73,992 906,337
Common Stock 60,116
RECEIVABLES
accrued income 299 299
employee
contributions 5,799 2,006 24,437
employer
contributions 2,233 817 9,532
Total assets 120,639 76,815 407 1,001,404
LIABILITIES
excess employee
contributions (7,335) (3,317) (55,203)
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $113,304 $ 73,498 $ 407 $ 946,201
</TABLE>
The accompanying notes to financial statements are an integral
part of this statement
John Q. Hammons Hotels, L.P.
401(k) Plan
Statement of Changes in Net Assets Availble for Plan Benefits
with Fund Information
As of December 31,1996
Fund Information
Participant-Directed
<TABLE>
<CAPTION>
John Q. Merrill Davis AIM Merrill
Hammons Lynch New York Constel Lynch
Hotels, Inc. Retirement Venture lation Growth
Common Preservation Fund Fund Fund
Stock Trust
ADDITIONS:
Investment income(loss):
Interest and
<S> <C> <C> <C> <C> <C>
dividends $ $ 1,843 $ 5,068 $ 9,152 $ 16,067
Realized and unrealized gains(losses)
(Notes 2 and 6) (12,401) 10,362 6,760 15,704
Total investment
income (loss) (12,401) 1,843 15,430 15,912 31,771
Contributions
Employee 47,671 49,563 67,907 191,300 138,680
Employer 21,666 21,611 30,476 79,157 58,620
Total contributions 69,337 71,174 98,383 270,457 197,300
Total additions 56,936 73,017 113,813 286,369 229,071
DEDUCTIONS
Distributions to
participants (136) (182) (217) (1,145)
INTERFUND TRANSFERS 44 6,809 (1,299) (1,433) (2,655)
Increase in net assets
available for plan
benefits 56,844 79,644 112,297 283,791 226,416
NET ASSETS AVAILABLE
FOR PLAN BENEFITS
Beginning of year
End of Year $ 56,844 $79,644 $112,297 $283,791 $226,416
</TABLE>
Statement of Changes in Net Assets Available - Continued
[CAPTION]
<TABLE>
Merrill Merrill
Lynch Lynch
Basic Corporate
Value Bond
Fund Fund Cash Fund Total
ADDITIONS:
Investment income (loss)
Interest and
<S> <C> <C> <C> <C> <C>
Dividends $ 5,545 $ 2,212 $ 407 $ 40,294
Realize and unrealized gains (losses)
(Notes 2 and 6) 3,841 250 24,516
Total investment
income (loss) 9,386 2,462 407 64,810
Contributions:
Employee 73,035 49,787 617,943
Employer 32,511 21,617 265,658
Total contibutions 105,546 71,404 883,601
Total additions 114,932 73,866 407 948,411
DEDUCTIONS
Distributions
to participants (530) (2,210)
INTERFUND TRANSFERS (1,628) 162
Increase in net assets available
for plan benefits 113,304 73,498 407 946,201
NET ASSETS AVAILABLE FOR PLAN
BENEFITS $113,304 $73,498 $407 $946,201
The accompanying notes to financial statements are an integral part
of this statement
John Q. Hammons Hotels,
L.P.
401(k) Plan
Notes to Financial Statements
December 31, 1996
(1) Plan Description-The following description of the John Q. Hammons
Hotels, L.P. 401(k) Plan (the Plan) is provided for general
information purposes only. More complete information regarding
the Plan's provisions may be found in the plan document.
General--The Plan is a defined contribution plan established by
John Q. Hammons Hotels, L.P. (the Company) on January 1, 1996. All
employees of the Company who are age 21 or older and have completed
one year of service, as defined, are eligible to participate.
The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA"), as amended.
Plan Administration--Under a trust agreement dated December 21,
1995, Merrill Lynch Trust Company (Merrill Lynch) was appointed
trustee for the Plan. The Plan is administered by an employee of
the Company as appointed by the Company's Board of Directors.
Contributions--Eligible employees can make voluntary contributions
to the Plan on a before-tax basis, subject to certain limitations
under the Internal Revenue Code (IRC). The Company provides a
matching contribution equal to 50% of each participant's voluntary
contribution up to a maximum of 6% of compensation per payroll
period.
Participant Account--Individual accounts are maintained for each of
the Plan's participants to reflect the participant's contributions
and related employer matching contributions, as well as the
participant's share of the Plan's income.
Allocations are based on the proportion that each participant's
account balance has to the total of all participants'
account balances.
Vesting--Participants are fully vested in their contributions and
the earnings thereon. Vesting in employer matching
contributions is based on years of continuous service.
Participants vest according to the following schedule:
less than three years 0% Years three through six 20% per year Seven
years or more 100%
Subsequent to the end of the plan year, The Plan was amended
(effective May 15, 1997) to reflect a new vesting
schedule which is summarized as follows:
Less than two years 0% Years two through five 20% per year Six years
or more 100%
Forfeited Accounts--Any forfeited accounts will be used to reduce
future employer matching contributions.
Benefits--Upon termination of service due to death, disability, or
retirement, a participant may elect to receive an amount
equal to the value of the participant's vested interest in his or
her account. The form of payment is a lump-sum distribution.
Expenses of the Plan--The Company provides administrative services
at no cost to the Plan. If not paid by the Company,
administrative expenses become a liability of the Plan.
Participant Loans--Participant loans are not permitted by the Plan.
Investment Options--Participants of the Plan may direct voluntary
contributions to be invested in one or more selected
options managed by Merrill Lynch. The investment options are
as follows:
John Q. Hammons Hotels, Inc. Common Stock This fund provides
participants the opportunity to share in company ownership.
Merrill Lynch Retirement Preservation Trust This fund aims
for preservation of participants' investments, liquidity
and current income that is typically higher than money
market funds.
Davis New York Venture Fund This fund seeks growth of capital.
AIM Equity Constellation Fund This fund aims for long-term
growth of capital by investing principally in common
stocks with emphasis on medium-sized and smaller emerging
growth companies.
Merrill Lynch Growth Fund This fund seeks growth of capital
and income by investing in securities believed to be
undervalued.
Merrill Lynch Basic Value Fund This fund seeks capital
appreciation and income by investing in securities believed
to be undervalued.
Merrill Lynch Corporate Bond Fund This fund aims to provide
a high level of current income through investment
grade corporate fixed-income securities.
The stated objectives of these Fund options are not necessarily
indicators of actual performance.
(2) Significant Accounting Policies-
Basis of Accounting--The accompanying financial statements are
prepared on the accrual basis of accounting. The
preparation of the financial statements in conformity with
generally accepted accounting principles requires the Plan's
management to use estimates and assumptions that affect the
accompanying financial statements and disclosures.
Actual results could differ from these estimates.
Investment Valuation--Cash equivalents are stated at cost, which
approximates fair value. Marketable securities are
stated at fair value. Securities traded on a national
securities exchange are valued at the last reported sales price
on the last business day of the year. Mutual funds are stated
at fair value as established by Merrill Lynch.
Realized gains and losses on the sale of investments and the
unrealized appreciation (depreciation) ofinvestments are
reported currently in the statement of changes in net assets
available for plan benefits.
The computation of unrealized appreciation (depreciation) in Plan
investments is based on the market values of the Plan investments
at yearend compared to their market values as of the beginning of
the Plan year, or at acquisition cost, if purchased during the year.
(3) Tax Status-
The Plan administrator believes that the Plan is currently designed
and is being operated in compliance with the applicable requirements
of the IRC. Therefore, the Plan administrator believes that the
Plan was qualified and the related trust was tax-exempt for the year
ended December 31, 1996. The plan administrator is now in the
process of requesting a ruling from the Internal Revenue Service
that the Plan is designed in accordance with the applicable
sections of the IRC.
(4) Priorities Upon Termination of the Plan-
Although it has not expressed any interest to do so, the Company has
the right under the Plan to discontinue its contributions at any
time and to terminate the Plan subject to the provisions of ERISA.
In the event of Plan termination, participants will become fully
vested in their account balances including employer contributions.
(5) Additional Information-
The following investments have fair values in excess of
five percent of net assets available for Plan benefits at:
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
December 31,
1996
John Q. Hammons Hotels, Inc. Common Stock $60,116
Merrill Lynch Retirement Preservation Trust 78,213
Davis New York Venture Fund 116,345
AIM Equity Constellation Fund 289,604
Merrill Lynch Growth Fund 235,576
Merrill Lynch Basic Value Fund 112,607
Merrill Lynch Corporate Bond Fund 73,992
</TABLE>
During the Plan year, the Plan's investments (including investments bought,
sold and held during the year) appreciated (depreciated) in value as follows:
1996
Mutual Funds $ 36,917
Common Stock (12,401)
$ 24,516
John Q. Hammons Hotels, L.P.
401(k) Plan
Item 27 (a) - Schedule of Assets Held for Investment Purposes
As of December 31, 1996
<TABLE>
<CAPTION>
Identity of Issuer,
Borrower, Lessor or
Similar Party Description of Investment
Including Maturity Date, Rate of Interest, Current
Collateral, and Par or Maturity Value Cost Value
Cash:
<C> <C> <C>
*Merrill Lynch Cash $ 683 $ 683
Common Stock:
*John Q. Hammons
Hotels, Inc. Common Stock, 7,072 shares $ 72,318 $ 60,116
Mutual Funds:
*Merrill Lynch Merrill Lynch Retiremnt
Preservation Trust 78,213 shares $ 78,213 78,213
Davis New York Venture Fund,
6,648 shares 106,122 116,345
Aim Equity Constellation Fund
11,465 shares 282,692 289,604
*Merrill Lynch Merrill lynch Growth Fund
9,016 shares 219,955 235,576
*Merrill Lynch Merrill Lynch Basic Value Fund
3,632 shares 108,759 112,607
*Merrill Lynch Merrill Lynch Corporate Bond Fund
6,496 shares 73,701 73,992
$869,442 $906,337
</TABLE>
*Represents a party in interest.
The accompanying notes to the financial statements
are an integral part of this schedule.
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit
plan) have duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
John Q. Hammons Hotels L.P. 401 (k)
_(s) Mel J. Volmert_____________________
Mel J. Volmert
Executive Vice President
Date July 15, 1997
Exhibit 23
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation by reference of our report dated July 9, 1997 included in this
Annual Report on Form 11-K for the year ended December 31,1996 of the John Q.
Hammons Hotels, L.P. 401(k) Plan, into its previously filed Registration
Statement File No. 033-73340-01
ARTHUR ANDERSON LLP
Cincinnati, Ohio
July 15, 1997
