UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------------
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
Commission File Number 33-89818, 33-96568 and 333-08041
CLUBCORP STOCK INVESTMENT PLAN
(Full title of the plan)
CLUB CORPORATION INTERNATIONAL
(Exact name of issuer of the securities held pursuant to the plan)
3030 LBJ FREEWAY, DALLAS, TEXAS 75234
(Address of principal executive office)
(972) 243-6191
(Issuer's telephone number; including area code)
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CLUBCORP STOCK INVESTMENT PLAN
INDEX TO ANNUAL REPORT ON FORM 11-K
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(a) Financial Statements
Description
----------------------------------------------------------
Independent Auditors' Report
Statements of Net Assets Available for Benefits
for the Years Ended December 31, 1996 and 1995
Statements of Changes in Net Assets Available for
Benefits for the Years Ended December 31, 1996 and 1995
Notes to Financial Statements
Item 27(a )- Schedule of Assets Held for Investment
Purposes as of December 31, 1996
Item 27(d) - Schedule of Reportable Transactions for
the Year Ended December 31, 1996
(b) Signatures
(c) Exhibit
23.1 - Consent of KPMG Peat Marwick LLP
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INDEPENDENT AUDITORS' REPORT
----------------------------
The Board of Trustees
ClubCorp Stock Investment Plan:
We have audited the accompanying statements of net assets available for
benefits of ClubCorp Stock Investment Plan as of December 31, 1996 and 1995,
and the related statements of changes in net assets available for benefits for
the years then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits 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 misstatement. 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 audits provide 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 benefits of ClubCorp Stock
Investment Plan as of December 31, 1996 and 1995, and the changes in net
assets available for benefits for the years then ended in conformity with
generally accepted accounting principles.
Our audits were made 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 as of December 31, 1996, and reportable
transactions for the year ended December 31, 1996, 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's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental
schedules have been subjected to the auditing procedures applied in the audits
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.
KPMG Peat Marwick LLP
Dallas, Texas
June 6, 1997
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CLUBCORP STOCK INVESTMENT PLAN
Statements of Net Assets Available for Benefits
December 31, 1996 and 1995
<S> <C> <C>
1996 1995
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Assets:
Club Corporation International common stock, at fair value (note 2) $43,233,147 35,413,929
Short-term investments, at fair value (note 2) 1,297,887 1,474,785
Cash 230,012 232,388
Receivables (note 3):
Employer contributions 1,719,446 382,282
Employee contributions 16,624 45,389
----------- ----------
1,736,070 427,671
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Total assets 46,497,116 37,548,773
----------- ----------
Liabilities - miscellaneous payables 42,581 23,973
----------- ----------
Net assets available for benefits $46,454,535 37,524,800
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See accompanying notes to financial statements.
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CLUBCORP STOCK INVESTMENT PLAN
Statements of Changes in Net Assets Available for Benefits
Years ended December 31, 1996 and 1995
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1996 1995
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Additions to net assets attributed to:
Employer contributions $ 2,386,159 1,031,351
Employee contributions 5,092,569 5,406,523
Net appreciation (depreciation) in fair value of investments -
Club Corporation International common stock 7,265,487 (554,874)
Investment income 81,408 59,670
----------- -----------
14,825,623 5,942,670
Deductions from net assets attributed to:
Benefits paid and withdrawals 5,772,875 6,066,520
Administrative expenses 123,013 278,905
----------- -----------
5,895,888 6,345,425
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Net increase (decrease) in net assets
available for benefits 8,929,735 (402,755)
Net assets available for benefits:
Beginning of year 37,524,800 37,927,555
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End of year $46,454,535 37,524,800
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See accompanying notes to financial statements.
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CLUBCORP STOCK INVESTMENT PLAN
Notes to Financial Statements
December 31. 1996 and 1995
(1) General
-------
The ClubCorp Stock Investment Plan (Plan) is a defined contribution plan
covering all employees of Club Corporation International's participating
subsidiaries (ClubCorp) who have completed one year of service and worked at
least l,000 hours during their eligibility year of service. The sponsoring
Employer of the Plan is ClubCorp. The Plan is subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA). Participants
should refer to the Plan document for more complete information.
(a) Basis of Presentation
-----------------------
The accompanying financial statements have been prepared on an accrual
basis.
(b) Contributions
-------------
Participating employees may elect to contribute up to 6% of their
eligible compensation to the Plan. The Employer matches 20% of the employee
contributions and may, at its discretion, match up to an additional 30% of
employee contributions. For the year ended December 31, 1996, ClubCorp made a
discretionary contribution of approximately $1,374,000. No such discretionary
contribution was made for the year ended December 31, 1995.
The maximum amount which may be added to any participant's account in any
year is the lesser of $30,000 or 25% of their compensation for that year for
all ClubCorp defined contribution plans. This maximum amount includes the
participant's share of ClubCorp's contributions.
(c) Participant Accounts
---------------------
Each participant's account is credited with the allocation of ClubCorp's
contributions based on the participant's contributions to the Plan. Earnings
and losses from investments are allocated to the participants' accounts based
on their individual quarter-end balances. Forfeitures of terminated
participants' nonvested accounts are used to cover direct administrative
expenses of the Plan (see note l(f)).
(d) Vesting
-------
Participants are gradually vested in ClubCorp's contributions as
determined by years of continuous service based on one hour of service for
each Plan year. Full vesting is attained after seven years of credited
service. Participants are always 100% vested in the account value of their
voluntary contributions and earnings thereon.
(e) Payment of Benefits
---------------------
Benefits are paid to participants upon retirement, permanent disability,
termination, or to beneficiaries upon death of the participant. The
participant or beneficiary may elect, subject to the terms of the Plan, to
receive his or her benefits in a lump sum cash distribution, in installments
over a fixed period, or through transfer to another retirement plan in an
amount equal to the value of the participant's account.
(f) Administrative Expenses
------------------------
Forfeitures are used by the Plan to pay direct administrative expenses
which amounted to $123,013 and $278,905 in 1996 and 1995, respectively.
Indirect expenses and any direct expenses not covered by forfeitures are paid
by the sponsoring Employer. Indirect administrative expenses of $327,511 and
$287,652 were paid by ClubCorp on behalf of the Plan in 1996 and 1995,
respectively.
(g) Plan Termination
-----------------
Although it has not expressed any intent to do so, ClubCorp has the right
to terminate the Plan at any time subject to the provisions of ERISA. If the
Plan were to terminate, participants would automatically become fully vested
regardless of years of service and the net Plan assets would be distributed to
Plan participants based on each participant's account balance.
(h) Form 5500 Reconciliation
--------------------------
The net assets available for benefits recorded in the Plan's Form 5500 as
of December 31, 1996 and 1995 are less than the corresponding amounts reported
in the accompanying financial statements by $577,306 and $999,663,
respectively. These differences relate to benefits payable at year-end for
terminations.
(i) Use of Estimates
------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of additions and deductions during the
reporting period. Actual results could differ from those estimates.
(2) Investments
-----------
The following table presents the fair value of investments at December
31, 1996 and 1995.
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1996 1995
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Principal/ Fair Principal/ Fair
shares value shares value
---------- ----------- ---------- -----------
Investments at quoted market
value - Dreyfus Institutional
Government Money
Market Fund 1,297,887 $ 1,297,887 1,474,785 $ 1,474,785
Investment at estimated fair
value - Club Corporation
International common stock 3,590,793 43,233,147 3,537,855 35,413,929
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Total investments $44,531,034 $36,888,714
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If available, quoted market prices are used to value investments of the
Plan. Because there is no public market for the common stock of ClubCorp, its
fair value is based upon a Formula Price which is determined quarterly by the
Company using a formula based on certain financial measures. The Trustees of
the Plan have retained a Financial Advisor to perform an independent appraisal
of the Company four times each year following delivery of the Company's
quarterly financial statements. Based upon such appraisals, the Financial
Advisor confirms that the Formula Price falls within the range of fair market
value of the common stock. During the years ended December 31, 1996 and 1995,
purchases of common stock made by the Plan were from two individual
shareholders and ClubCorp.
(3) Employer and Employee Contributions Receivable
--------------------------------------------------
Matching contributions are allocated to employees' accounts at the end of
each quarter; therefore, the accompanying financial statements reflect a
receivable for the fourth quarter's Employer match credited to employees'
accounts but not received at December 31, 1996 and 1995. At December 31,
1996, Employer contributions receivable includes the Employer discretionary
contribution of approximately $1,374,000 (see note 1(b)).
(4) Federal Income Taxes
----------------------
The Plan obtained its latest tax determination letter on December 21,
1995, in which the Internal Revenue Service stated that the Plan was in
compliance with the applicable requirements of the Internal Revenue Code
(IRC). The Plan administrator believes that the Plan is currently being
operated in compliance with the applicable requirements of the IRC.
(5) Plan Amendment
---------------
The Plan was amended and restated effective as of January 1, 1995.
Participants may elect to defer the receipt of a portion of their
compensation, beginning July 1, 1995, by contributing to the Plan on a pre-tax
basis in accordance with Section 401(k) of the Internal Revenue Code.
After-tax contributions ceased June 30, 1995.
(6) Financial Instruments
----------------------
The carrying values of financial instruments such as cash, receivables and
liabilities approximate their fair values because of the nature and short
maturity of these instruments. Club Corporation International common stock
and short-term investments are carried at fair value.
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Schedule 1
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CLUBCORP STOCK INVESTMENT PLAN
Item 27(a) - Schedule of Assets Held for Investment Purposes
as of December 31, 1996
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Current
Identity of issue Description of investment Cost value
- -------------------------------- ------------------------- ----------- ----------
Common stock - Club 3,590,793 shares $22,199,415 43,233,147
Corporation International*
Short-term investments - Dreyfus
Institutional Government Money
Market Fund 1,297,887 units 1,297,887 1,297,887
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Total investments $23,497,302 44,531,034
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*Party-in-interest
See accompanying independent auditors' report.
Schedule 2
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CLUBCORP STOCK INVESTMENT PLAN
Item 27(d) - Schedule of Reportable Transactions
for the year ended December 31, 1996
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Expense Current value
Aggregate incurred asset on Net
Description number of Purchase Selling Lease with Cost of transaction gain
of asset transactions price price rental transaction asset date (loss)
----------------- ------------ ---------- --------- ------ ----------- --------- ------------- ------
Purchases:
Dreyfus Institutional
Government Money
Market Fund Money market fund 6 $2,425,000 - 2,425,000 2,425,000 -
Club Corporation 52,938 shares of
International* common stock 3 553,731 - - - 553,731 553,731 -
Sales:
Dreyfus Institutional
Government Money
Market Fund Money market fund 7 - 2,675,000 - - 2,675,000 2,675,000 -
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* Party-in-interest
See accompanying independent auditors' report.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
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CLUBCORP STOCK INVESTMENT PLAN
CLUB CORPORATION INTERNATIONAL
Plan Administrator
Date: June 26, 1997 By: /s/ John H. Gray
- -------------------- -------------------------------
John H. Gray
Chief Administrative Officer
and Executive Vice President
(chief accounting officer)
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Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Club Corporation International:
We consent to incorporation by reference in the registration statements (Nos.
33-89818, 33-96568 and 333-08041) on Form S-8 of Club Corporation
International of our report dated June 6, 1997, relating to the statements of
net assets available for benefits of ClubCorp Stock Investment Plan as of
December 31, 1996 and 1995, and the related statements of changes in net
assets available for benefits for the years then ended, and the related
supplemental schedules which report appears in the December 31, 1996 annual
report on Form 11-K of ClubCorp Stock Investment Plan.
KPMG Peat Marwick LLP
Dallas, Texas
June 26, 1997
