ITEM 1. BUSINESS.
(a) The registrant, Uptowner Inns, Inc., is a corporation that was incorporated in the State of West Virginia on July 1, 1961. The registrant owns and operates a motor hotel with a Holiday Inns Franchise that consists of dining, banquet, and lounge facilities, and also operates three apartment buildings, rental properties all located in the City for Huntington, West Virginia.
The main physical property of Uptowner Inn of Parkersburg, Inc., had a swimming pool, dining and banquet facilities, and two parcels, owned in fee by such subsidiary, located in downtown Parkersburg, West Virginia at 415 Seventh Street. The Hotel was closed on June 30, 1987. On August 31, 1994, the property was sold for $750,000.
A wholly owned subsidiary of the registrant, Motel and Restaurant Supply, which was incorporated in the State of West Virginia on July 16, 1966, has had no activity since 1981.
Neither the registrant nor any of its subsidiaries has experienced bankruptcy, receivership or similar proceedings; has been involved in reclassification, merger or consolidation; has acquired or, except as hereinafter set forth, disposed of any material amount of assets otherwise than in the ordinary course of business; or has undertaken any material change in the mode of conducting its business.
(b) The registrant is engaged in substantially one line of business, to-wit, the operation of motor hotels and related facilities.
(c) The registrant is engaged in substantially one line of business, to wit, the operation of motor hotels with dining and banquet facilities, and residential/commercial rentals. The income of the registrant from rentals represents less than ten percent of the consolidated revenue of the registrant and its subsidiaries, which consolidated revenue did not exceed $50,000,000. during any of the last three fiscal years.
The hotel industry is highly competitive with the registrant competing against numerous national hotel franchises in Huntington, West Virginia. As the Companies' operations are generally one business segment, its competition locally includes Radisson hotel, Ramada Inn, Holiday Inn, Comfort Inn, and Red Roof Inn.
Seasonality directly affects this business as a result of people not traveling or vacationing in large numbers in the late fall and winter because of poor weather at these geographical locations.
At June 30, 1995, the registrant and its subsidiaries employ approximately 57 employees.
(d) The registrant has no foreign operation.
PART II
Item 2.
Item 2. Properties.
(a) The main physical property of the registrant is a 140 unit, four story motor hotel, with swimming pool, dining, banquet, and lounge facilities, located in downtown Huntington, West Virginia, at 1415 Fourth Avenue. This property is owned in fee by the registrant and operated with a Holiday Inn Franchise. The motor hotel is subject to a mortgage in favor of the Twentieth Street Bank, Huntington, West Virginia, in the original amount of $2,000,000., payable in monthly installments of $22,568. per month, including interest at 10% until February 4, 2004, when the amount due must be paid in full. The balance at June 30, 1995 is $1,554,279.
(b) The registrant owns in fee two lots, used for the over- flow parking, across the street from its main motor hotel at 1432-34 Fourth Avenue, in Huntington, West Virginia.
(c) The registrant owns in fee an undeveloped lot acquired for future development or parking, across an alley from its main motor hotel at 1400 Fifth Avenue in Huntington, West Virginia.
(d) The registrant owns in fee a lot improved by a three story brick building used as a fraternity house, across an alley from its main motor hotel, 1434 Fifth Avenue, in Huntington, West Virginia, acquired for rental and for future development.
(e) The registrant owns in fee two lots immediately west of its motor hotel, 1401 Fourth Avenue, in Huntington, West Virginia, acquired for future development and currently used for parking. This property is subject to a first mortgage in favor of the Twentieth Street Bank in the original amount of $2,000,000. as noted in Item 2 (a).
(f) The registrant owns in fee and operates a 40 unit, two story apartment building within one city block of the motor hotel, at 1340 Fourth Avenue, in Huntington, West Virginia.
(g) The registrant owns in fee a lot acquired for future development or parking, across the street from its main motor hotel at 1420 Fourth Avenue, in Huntington, West Virginia.
(h) The registrant owns in fee an undeveloped lot acquired for future development or for parking, across an alley from its main motor hotel at 1438 Fifth Avenue, in Huntington, West Virginia.
(i) The registrant owns in fee and operates a two story duplex within one city block of the main motor hotel at 1326 Fourth Avenue, in Huntington, West Virginia.
PART II
(j) The registrant owns in fee a lot improved by a three story building originally used as a store and apartment, within one city block of the main motor hotel at 1416-18 Fourth Avenue, in Huntington, West Virginia, acquired for rental and for future development, subject to a mortgage in favor of Betty M. Dove, in the original amount of $76,000., 10% interest, maturing June 2002, the balance of which was $44,546. at June 30, 1995.
(k) The registrant owns in fee two parcels within one city block of the main motor hotel at 1436-38 Fourth Avenue and 1440-42 Fourth Avenue, in Huntington, West Virginia acquired for future development.
(l) The registrant owns in fee a parcel of real estate on the west side of Huntington approximately 3 miles from the main motor hotel and at an exit for Interstate 64. This purchase was finalized in October 1988 from an option entered into in 1983. The property is to be operated as a rental property until it is deemed beneficial to build and operate a decent motel in that location.
(m) The registrant purchased a parcel of real estate with a residential building in January 1990. This property is across an alley from the main motor hotel and was acquired for future development and parking.
(n) The registrant purchased a parcel of real estate with a building housing residential and commercial tenants in July 1991. This property is across the street from its main motor hotel and adjacent to other rental properties and parking facilities. The property has been renovated and is now fully utilized as rental property. The property is subject to a mortgage in favor of West Virginia Housing Development Fund in the original amount of $500,000., 5.5% rate of interest, maturing November 2018, the balance of which is $484,577.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS:
A suit in which the Uptowner Inns, Inc. is a defendant has been filed by an individual who was severely injured in an auto accident by a patron of the lounge. Legal counsel believes that good defenses exist in this action, and that the case will ultimately be resolved in Uptowner Inns, Inc.'s favor. The insurance company has denied liability in this case and legal counsel believes the risk of loss will fall to Uptowner Inns, Inc.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SECURITY HOLDER MATTERS.
(a) The common stock of the registrant is traded in the over- the-counter market. During the past two years, there has been limited activity of common stock. These shares were traded at $.65 a share.
(b) As of the 11th day of September 1995, the approximate number of record holders of common stock securities of the registrant was 1,184.
(c) The registrant has paid no dividends with respect to its common stock during the past two years.
ITEM 6. SELECTED FINANCIAL DATA.
The following financial information of Uptowner Inns, Inc. and Subsidiaries is for the years ended June 30, 1995, June 30, 1994, June 30, 1993, June 30, 1992 and June 30, 1991 on a scope similar to that set forth in the report included elsewhere in this report. These Summaries should be read in conjunction with the financial statements and related notes included elsewhere in this report.
[CAPTION] OTHER INCOME (EXPENSE)
1995 1994 1993
Gain (Loss) on sales of property, plant and equipment $ - $ - $ 1,950. Gain (Loss) on disposal of subsidiary 306,930. - -
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE FEDERAL INCOME TAXES
1995 1994 1993
$ 502,600. $( 81,046.) $( 65,637.)
INCOME TAXES
1995 1994 1993
Income taxes (benefit) $ - $ - $ - Effective tax rate - - -
There is no tax benefit for the fiscal years 1994 and 1993 due to the loss and the lack of any taxable income to apply this against. For the year ended June 30, 1995, the Company utilized operating loss carryforwards in the amount of $485,679. to offset taxable income. The Company has a carryforward loss for taxable income until the year 2008.
INCOME (LOSS)
1995 1994 1993
$ 494,600. $( 81,046.) $( 59,848.)
The sale of the Parkersburg property in August 1994, with the gain of $306,930., had an obvious impact on income, but the increase in revenues of $203,611. and the decrease of expenses of $65,105. resulted in a significant change in Income From Operations from a loss of $81,046. in 1994 to an increase of $187,670. in 1995.
[CAPTION] LIQUIDITY AND CAPITAL RESOURCES
1995 1994
Resources available at June 30, 1995 and 1994
Cash $ 298,380. $ 119,199. Investments 576,470. -
Because of resources available to the Company and its current financial condition and structure, it is management's opinion that, barring a severe decline in the nation's economy, there will be financial improvement in the future reporting periods.
Due to the property sale and significant improvement of income from operations, the liquidity is the strongest the Company has ever experienced. It is anticipated that the next year will provide opportunity to improve the liquidity further, subject to the final costs that may be incurred to update the motor hotel property to retain the Holiday Inn Franchise. The improvement would be as a result of the operating activities continuing to generate a good cash flow and the costs of major improvements not causing declines.
UPTOWNER INNS, INC. AND SUBSIDIARIES
PART III
Item 10. Directors and Executive Officers of the Registrant
The information required by Item 10, Part III, will be set forth in the definitive proxy statement to be filed by the registrant, pursuant to Regulation 14A, under the captions "Election of Directors" and "Executive Officers of the Company" and is incorporated herein by reference.
Item 11. Executive Compensation
The information required by Item 11, Part III, will be set forth in the definitive proxy statement to be filed by the registrant, pursuant to Regulation 14A, under the caption "Remuneration of Directors and Executive Officers", and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management
(a) The registrant has issued only one type of security, namely, common capital stock. The following table sets forth certain information as to the persons and groups who are known to the registrant to be the beneficial owners of more than five percent of its voting securities.
Title of Name and Address Amount and Nature of Percent Class of Beneficial Owner Beneficial Ownership of Class
Common Violet Midkiff 673,652 Direct and 42.5 922 Eleventh Street Indirect Huntington, West Virginia
(b) The following table sets forth certain information as to each class of equity securities of the registrant beneficially owned by all directors and officers of the registrant as a group.
Title of Name and Address Amount and Nature of Percent Class of Beneficial Owner Beneficial Ownership of Class
Common Arthur J. Huber 30,049 Indirect 1.9
Common James R. Camp 6,212 Direct .4
Common Violet Midkiff 673,652 Direct and 42.5 Indirect
Item 12. Security Ownership of Certain Beneficial Owners and Management (Cont'd)
Title of Name and Address Amount and Nature of Percent Class of Beneficial Owner Beneficial Ownership of Class
Common Louis Abraham 2,546 Direct .2
Common Carl Midkiff 9,020 Direct and .6 Indirect
Common Olive Hager 21,870 Direct 1.4
Common Six Officers and 743,349 Direct and 27.7 Directors as a Indirect Group
(c) There is no arrangement, known to the registrant, the operation of which may at a subsequent date result in a change in control of the registrant.
UPTOWNER INNS, INC. AND SUBSIDIARIES
ITEM 14 EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(A)(1) Financial Statements:
Uptowner Inns, Inc. and Subsidiaries Opinion of Independent Certified Public Accountant Consolidated Balance Sheets as of June 30, 1995 Consolidated Statement of Income for the Year Ended June 30, 1995 Consolidated Statement of Stockholders' Equity for the Year Ended June 30, 1995 Consolidated Statement of Cash Flows for the Year Ended June 30, 1995 Notes to Consolidated Financial Statements
Uptowner Inns, Inc. and Subsidiaries Opinion of Independent Certified Public Accountant Consolidated Balance Sheets as of June 30, 1994 and 1993 Consolidated Statement of Income for the Years Ended June 30, 1994, 1993 and 1992 Consolidated Statement of Stockholders' Equity for the Years Ended June 30, 1994, 1993 and 1992 Consolidated Statement of Cash Flows for the Years Ended June 30, 1994, 1993 and 1992 Notes to Consolidated Financial Statements
(A)(2) Schedules:
Schedule II -- Accounts Receivable from Related Parties and Underwriters Schedule V -- Property, Plant and Equipment Schedule VI -- Accumulated Depreciation of Property, Plant and Equipment Schedule VIII -- Valuation of Qualifying Accounts Schedule XII -- Mortgage Loans on Real Estate
	 All other schedules are omitted since required information is either not applicable, not deemed material or is shown in the respective financial statements or in the notes thereto.
(A)(3) Exhibits:
(22) Subsidiaries of Uptowner Inns, Inc.:
All other required exhibits are incorporated in the Registration Statement Number 2-90194 of Uptowner Inns, Inc.
No reports on Form 8-K have been filed during the period covered by this report. A Form 8-K was filed September 13, 1995 under Item 4