Last edited 4:30 p.m., Feb. 15, 2018
John Q. Hammons Hotels & Resorts agreed to a bankruptcy settlement Feb. 13 with the company’s largest creditor, J.D. Holdings LLC.
Under the terms of the agreement, J.D. Holdings — whose owner Jonathan Eilian helped privatize John Q. Hammons’ publicly traded company — will take over JQH Hotels’ 35 hotels and myriad other assets, according to a company statement provided with court documents filed with the U.S. Bankruptcy Court in Kansas City.
Court documents indicate J.D. Holdings will take out a $1 billion loan for the purchase via Goldman Sachs. An advisement letter issued to J.D. Holdings — and included in court documents — by Goldman Sachs officials said J.D. Holdings would buy “all or substantially all of the real property assets … owned by the Revocable Trust of John Q. Hammons.” Trust assets include Hammons Tower, Highland Springs, Hammons Field and more.
JQH Hotels’ hotel portfolio includes University Plaza Hotel and Convention Center in downtown Springfield, as well as the Residence Inn in Springfield and Chateau on the Lake in Branson.
When the settlement plan is finalized, J.D. Holdings’ Atrium Hospitality LP affiliate would manage the JQH hotels.
The landmark decision would effectively end the nearly two-year-old bankruptcy case.
“We are glad to have reached a settlement with the trustees of the John Q. Hammons Trust,” said Eilian, J.D. Holdings’ chairman, in the statement. “With our disputes behind us, we look forward to combining the management of Atrium’s existing portfolio with the hotel properties held by the trust, all of which were developed by Mr. Hammons over the course of his visionary and distinguished career in the hotel industry.”
According to the statement, J.D. Holdings expects to keep on “virtually all” of JQH Hotels’ 4,000 employees and the majority of management. It also agreed to start a $20 million charitable trust in late hotelier Hammons’ name. Hammons died in 2013 at age 94.
Court documents indicate J.D. Holdings intends to terminate the employment of CEO Jacquie Dowdy and General Counsel Greggory Groves. Dowdy and Groves will remain successor trustees of the JQH Trust, according to the documents.
“This is a historic day as we celebrate coming to a satisfactory agreement with Mr. Eilian to ensure that Mr. Hammons’ legacy can properly live on,” Dowdy said in the statement. “I look forward to working with Mr. Eilian on a smooth transition that leverages JQH’s award-winning, performance-oriented qualities.”
The agreement is pending court approval, scheduled for a hearing Feb. 28 in Kansas City.
JQH Hotels filed for Chapter 11 bankruptcy protection in June 2016, essentially halting Eilian’s litigation efforts to take over its properties.
The 2005 agreement that privatized JQH Hotels gave Eilian’s holding company indirect ownership of 43 Hammons’ hotels and management of 15 others. He has sought to pick up the remaining 35 properties.
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