-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MOKLTAHspOhcW5tOWaZR+adNJc42lLlK4yO2oblp2TOuA/29U5Rf9uqe3jCKfEQS 3TDRAAfDN17ts7qbTDEDnA== 0000950136-04-002159.txt : 20040702 0000950136-04-002159.hdr.sgml : 20040702 20040702110241 ACCESSION NUMBER: 0000950136-04-002159 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040622 ITEM INFORMATION: ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040702 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST UNION REAL ESTATE EQUITY & MORTGAGE INVESTMENTS CENTRAL INDEX KEY: 0000037008 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 346513657 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-06249 FILM NUMBER: 04897767 BUSINESS ADDRESS: STREET 1: 7 BULFINCH PLACE STREET 2: SUITE 500 PO BOX 9507 CITY: BOSTON STATE: MA ZIP: 02114 BUSINESS PHONE: 6175704614 MAIL ADDRESS: STREET 1: 7 BULFINCH PLACE STREET 2: SUITE 500 PO BOX 9507 CITY: BOSTON STATE: MA ZIP: 02114 FORMER COMPANY: FORMER CONFORMED NAME: FIRST UNION REALTY DATE OF NAME CHANGE: 19691012 8-K 1 file001.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported) June 22, 2004 FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS ------------------------------------------------------- (Exact Name of Registrant as Specified in Its Charter) Ohio ------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 001-06249 34-6513657 - ------------------------ ------------------------------------ (Commission File Number) (I.R.S. Employer Identification No.) 7 Bulfinch Place, Suite 500, P.O. Box 9507, Boston, Massachusetts 02114 - ------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (617) 570-4600 -------------- (Registrant's Telephone Number, Including Area Code) n/a ------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Item 2. Acquisition or Disposition of Assets On June 22, 2004, First Union Real Estate Equity and Mortgage Investments (the "Company") sold its Park Plaza Mall Plaza property located in Little Rock, Arkansas for a gross purchase price of $77,500,000 to a subsidiary of CBL & Associates, Inc., an unrelated third party. In connection with this transaction, the purchaser assumed the existing indebtedness encumbering the property of approximately $41.3 million. Accordingly, net proceeds to the Company after giving effect to the loan assumption and closing costs were approximately $33.5 million. The Company has deposited the proceeds with a qualified intermediary as the Company will seek to use the proceeds in connection with a "like kind" exchange pursuant to section 1031 of the Internal Revenue Code. There can be no assurance, however, that a suitable replacement property will be timely identified in order for the Company to consummate a "like kind" exchange transaction. In the event that a "like kind" exchange cannot be consummated, the estimated gain for tax purposes from the sale of this property will be approximately $20,500,000. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (b) Pro Forma Financial Information The required pro forma financial information is found on pages 3-9 hereto. (c) Exhibits 99 Press Release, dated June 22, 2004 with respect to the sale of the Little Rock, Arkansas property. Item 12. Results of Operations and Financial Condition On June 22, 2004, the Registrant issued a press release announcing the sale of its Little Rock, Arkansas property. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized on this 1st day of July, 2004. FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS By: /s/ Carolyn Tiffany ------------------------------------- Carolyn Tiffany Chief Operating Officer 2 FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS UNAUDITED PRO FORMA COMBINED BALANCE SHEET AS OF MARCH 31, 2004 AND STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2003 AND FOR THE THREE MONTHS ENDED MARCH 31, 2004 The unaudited pro forma combined balance sheet of First Union Real Estate Equity and Mortgage Investments (the "Company") as of March 31, 2004 is presented as if the sale of Park Plaza Mall occurred on that date. The pro forma combined statements of operations for the year ended December 31, 2003 and for the three months ended March 31, 2004 are presented as if the sale of Park Plaza Mall had occurred on January 1, 2003. The unaudited pro forma combined balance sheet and pro-forma combined statements of operations should be read in conjunction with the combined balance sheet and combined statement of operations for the year ended December 31, 2003 of the Company and notes thereto included therein. In the opinion of Company management, all adjustments necessary to reflect the effects of the sale of Park Plaza Mall have been made. The unaudited pro forma combined balance sheet and statements of operations are prepared for informational purposes only and are not necessarily indicative of the Company's future results or of actual results that would have been achieved if the sale had been completed as of the date indicated above. 3 COMBINED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS FOR THE YEAR ENDED DECEMBER 31, 2003 (UNAUDITED)
PRO FORMA ADJUSTMENTS (In thousands, except per share data) HISTORICAL (A) PARK PLAZA MALL PRO FORMA TOTAL -------------- --------------- --------------- REVENUES Rents $ 13,916 $(12,327)(b) $ 1,589 Sales 1,892 -- 1,892 Interest and dividends 838 -- 838 -------- -------- -------- 16,646 (12,327) 4,319 -------- -------- -------- EXPENSES Property operating 4,965 (4,116)(b) 849 Cost of goods sold 3,279 -- 3,279 Real estate taxes 773 (809)(b) (36) Depreciation and amortization 2,161 (1,669)(c) 492 Interest 4,551 (3,667)(d) 884 General and administrative 6,873 -- (e) 6,873 -------- -------- -------- 22,602 (10,261) 12,341 -------- -------- -------- LOSS BEFORE GAIN ON SALE (5,956) (2,066) (8,022) Gain on sale 54 -- 54 -------- -------- -------- NET LOSS BEFORE PREFERRED DIVIDENDS (5,902) (2,066) (7,968) Preferred dividend (2,064) -- (2,064) -------- -------- -------- NET LOSS APPLICABLE TO COMMON SHARES OF BENEFICIAL INTEREST $ (7,966) $ (2,066) $(10,032) ======== ======== ======== HISTORICAL PER SHARE DATA BASIC AND DILUTED: Net loss applicable to common shares of beneficial interest $ (0.26) ========
(CONTINUED) 4 COMBINED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS FOR THE YEAR ENDED DECEMBER 31, 2003 (UNAUDITED) (CONTINUED)
PRO FORMA ADJUSTMENTS (In thousands, except per share data) HISTORICAL (A) PARK PLAZA MALL PRO FORMA TOTAL -------------- --------------- --------------- PRO FORMA PER SHARE DATA BASIC AND DILUTED: Net loss applicable to common shares of beneficial interest $(0.32) ======== BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES 30,885 ========
See notes to pro forma combined balance sheet and statements of operations. 5 COMBINED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS FOR THE THREE MONTHS ENDED MARCH 31, 2004 (UNAUDITED)
PRO FORMA ADJUSTMENTS (In thousands, except per share data) HISTORICAL (A) PARK PLAZA MALL PRO FORMA TOTAL -------------- --------------- --------------- REVENUES Rents $ 3,291 $(2,920)(b) $ 371 Sales 1,309 -- 1,309 Interest and dividends 254 -- 254 ------- ------- ------- 4,854 (2,920) 1,934 ------- ------- ------- EXPENSES Property operating 1,154 (960)(b) 194 Cost of goods sold 934 -- 934 Real estate taxes 219 (203)(b) 16 Depreciation and amortization 499 (431)(c) 68 Interest 943 (910)(d) 33 General and administrative 1,310 (83)(e) 1,227 ------- ------- ------- 5,059 (2,587) 2,472 ------- ------- ------- NET LOSS BEFORE PREFERRED DIVIDENDS (205) (333) (538) Preferred dividend (516) -- (516) ------- ------- ------- NET LOSS (721) (333) (1,054) OTHER COMPREHENSIVE INCOME Unrealized gain on securities 396 -- 396 ------- ------- ------- Comprehensive loss $ (325) $ (333) $ (658) ======= ======= ======= HISTORICAL PER SHARE DATA BASIC AND DILUTED: Net loss applicable to common shares of beneficial interest $ (0.02) =======
(CONTINUED) 6 COMBINED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS FOR THE THREE MONTHS ENDED MARCH 31, 2004 (UNAUDITED) (CONTINUED)
PRO FORMA ADJUSTMENTS (In thousands, except per share data) HISTORICAL (A) PARK PLAZA MALL PRO FORMA TOTAL -------------- --------------- --------------- PRO FORMA PER SHARE DATA BASIC AND DILUTED: Net loss applicable to common shares of beneficial interest $(0.03) ======= BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES 31,059 =======
See notes to pro forma combined balance sheet and statements of operations. 7 COMBINED BALANCE SHEET FOR THE THREE MONTHS ENDED MARCH 31, 2004
PRO FORMA ADJUSTMENTS (In thousands, except share data) HISTORICAL (F) PARK PLAZA MALL PRO FORMA TOTAL -------------- --------------- --------------- ASSETS Investments in real estate, at cost Land $ 6,680 $ (5,816)(g) $ 864 Buildings and improvements 65,940 (60,016)(g) 5,924 --------- --------- --------- 72,620 (65,832) 6,788 Less - Accumulated depreciation (14,571) 10,302(g) (4,269) --------- --------- --------- Investments in real estate, net 58,049 (55,530) 2,519 Cash and cash equivalents - unrestricted 5,618 33,474(h) 39,092 - restricted 2,616 (1,310)(h) 1,306 Loan receivable 16,944 -- 16,944 Accounts receivable and prepayments, net of allowances 379 (47)(i) 332 Investments - available for sale 54,881 -- 54,881 Real estate securities - available for sale 6,470 -- 6,470 Inventory, net of reserve 613 -- 613 Unamortized debt issue costs, net 206 (206)(i) -- Other 637 (77)(i) 560 --------- --------- --------- Total Assets $ 146,413 $ (23,696) $ 122,717 ========= ========= ========= LIABILITIES Mortgage loan $ 41,370 $ (41,370)(j) $ -- Note payable 58 -- 58 Accounts payable and accrued liabilities 7,544 (913)(i) 6,631 Dividends payable 516 -- 516 Deferred items 530 (396)(i) 134 --------- --------- --------- Total Liabilities 50,018 (42,679) 7,339 --------- --------- --------- CONTINGENCIES (NOTE 10) SHAREHOLDERS' EQUITY Convertible preferred shares of beneficial interest, $25 per share liquidation preference, 2,300,000 shares authorized, 983,082 shares outstanding at March 31, 2004 23,131 -- 23,131 Common Shares of beneficial interest, $1 par, unlimited authorized, 31,058,913 outstanding at March 31, 2004 31,059 -- 31,059 Additional paid-in capital 207,968 -- 207,968 Accumulated other comprehensive income 396 -- 396 Accumulated distributions in excess of net income (166,159) (55,530)(g) 32,164 (h) 979 (i) 41,370 (j) (147,176) --------- --------- --------- Total Shareholders' Equity 96,395 18,983 (k) 115,378 --------- --------- --------- Total Liabilities and Shareholders' Equity $ 146,413 $ (23,696) $ 122,717 ========= ========= =========
See notes to pro forma combined balance sheet and statements of operations. 8 FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS UNAUDITED PRO FORMA COMBINED BALANCE SHEET AS OF MARCH 31, 2004 AND STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2003 AND FOR THE THREE MONTHS ENDED MARCH 31, 2004 (a) Reflects the historical combined statements of operations for the Company for the year ended December 31, 2003 as reported on Form 10-K and for the three months ended March 31, 2004 as reported on Form 10-Q. (b) Reflects the historical rental income and operating expenses of Park Plaza Mall. (c) Reflects depreciation on the sold asset and amortization of costs incurred to obtain the mortgage financing secured by the Park Plaza Mall. (d) Reflects interest expense on the mortgage loan payable secured by the Park Plaza Mall. (e) Reflects an adjustment for the asset management fee. The asset management fee included in general and administrative expenses in 2004 is based on a sliding percentage of gross asset value. There is no adjustment in 2003 as the asset management fee was a flat fee arrangement not based on asset values. (f) Reflects the historical combined balance sheet of the Company as of March 31, 2004 as reported on Form 10-Q. (g) Reflects Park Plaza Mall real estate assets stated at cost and depreciation taken from original date of acquisition. (h) Reflects the net cash resulting from the sale of the Park Plaza Mall. (i) Reflects other assets and liabilities associated with the Park Plaza Mall. (j) Reflects principal balance of mortgage loan outstanding at time of sale secured by the Park Plaza Mall. (k) Reflects the net impact of the sale and eliminates the operations of the Park Plaza Mall from January 1, 2003 through March 31, 2004. 9 EXHIBIT INDEX Exhibit Page - ------- ---- 99. Press Release dated June 22, 2004. 11 10 EX-99.1 2 file002.txt PRESS RELEASE DATED JUNE 22, 2004 Exhibit 99 FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS - ------------------------------------------------------- AT THE COMPANY - -------------- Carolyn Tiffany Chief Operating Officer (617) 570-4614 FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS ANNOUNCES SALE OF LITTLE ROCK, ARKANSAS MALL Boston, Massachusetts-June 22, 2004-First Union Real Estate Equity and Mortgage Investments (NYSE:FUR) is pleased to announce that it sold its property located in Little Rock, Arkansas commonly referred to as Park Plaza Mall for a gross sales price of $77,500,000 to CBL & Associates Properties, Inc. (NYSE:CBL). Net proceeds from the sale after closing costs are expected to be approximately $33.5 million, subject to certain post-closing adjustments. ------------------- First Union Real Estate Equity and Mortgage Investments is a NYSE-listed real estate investment trust (REIT) headquartered in Boston, Massachusetts. -----END PRIVACY-ENHANCED MESSAGE-----