-----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, HilD5uTqti/g90UP4UWKh41QUYNJPntThAaWek2ZsRwe0GcWQrsqPAJJt43XXerE GwowMHWepnTKArnyvLTPew== 0000950146-99-001661.txt : 19991018 0000950146-99-001661.hdr.sgml : 19991018 ACCESSION NUMBER: 0000950146-99-001661 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990831 FILED AS OF DATE: 19991015 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MGI PROPERTIES CENTRAL INDEX KEY: 0000068330 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 046268740 STATE OF INCORPORATION: MA FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-06833 FILM NUMBER: 99729119 BUSINESS ADDRESS: STREET 1: ONE WINTHROP SQUARE CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6174226000 MAIL ADDRESS: STREET 1: ONE WINTHROP SQUARE CITY: BOSTON STATE: MA ZIP: 02110 FORMER COMPANY: FORMER CONFORMED NAME: MORTGAGE GROWTH INVESTORS DATE OF NAME CHANGE: 19880225 FORMER COMPANY: FORMER CONFORMED NAME: EASTERN SHOPPING CENTERS INC DATE OF NAME CHANGE: 19711121 10-Q 1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended: August 31, 1999 Commission File Number: 1-6833 MGI PROPERTIES ------------------------------------------------------ (Exact name of registrant as specified in its charter) MASSACHUSETTS 04-6268740 ------------------------------ ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) One Winthrop Square, Boston, Massachusetts 02110 --------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (617) 422-6000 N/A --------------------------------------------------- Former name, former address and former fiscal year, if changed since last report. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_| Common shares outstanding as of October 15, 1999: 13,774,221 Page 1 of 16 pages Exhibit Index appears on Page 14 MGI PROPERTIES INDEX PART I: FINANCIAL INFORMATION Page No. -------- Item 1: Financial Statements Consolidated Balance Sheets 3 Consolidated Statements of Earnings 4 Consolidated Statements of Cash Flow 5 Consolidated Statements of Changes in Shareholders' Equity 6 Notes to Consolidated Financial Statements 7 Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II: OTHER INFORMATION Items 1 - 6 14 Signatures 15 Exhibit 11: Computation of Earnings Per Share 16 -2- MGI PROPERTIES PART I -- FINANCIAL INFORMATION CONSOLIDATED BALANCE SHEETS
- ------------------------------------------------------------------------------------------ August 31, 1999 November 30, 1998 (unaudited) - ------------------------------------------------------------------------------------------ ASSETS Properties held for sale $ 93,913,000 $365,543,000 Cash and cash equivalents 53,170,000 12,265,000 Short term investments 19,709,000 -- Accounts receivable 722,000 5,040,000 Other assets 4,643,000 11,655,000 - ------------------------------------------------------------------------------------------ $172,157,000 $394,503,000 ========================================================================================== LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Loans payable $ 34,629,000 $130,517,000 Liquidating liabilities 9,780,000 880,000 Other liabilities 3,136,000 6,284,000 - ------------------------------------------------------------------------------------------ Total liabilities 47,545,000 137,681,000 Shareholders' equity: Common shares -- $1 par value; 17,500,000 shares authorized; 13,774,221 issued (13,764,221 at November 30, 1998) 13,774,000 13,764,000 Additional paid-in capital 208,363,000 208,278,000 Undistributed (distribution in excess of) net income (97,525,000) 34,780,000 - ------------------------------------------------------------------------------------------ Total shareholders' equity 124,612,000 256,822,000 - ------------------------------------------------------------------------------------------ $172,157,000 $394,503,000 ==========================================================================================
See accompanying notes to consolidated financial statements. -3- MGI PROPERTIES CONSOLIDATED STATEMENTS OF EARNINGS (unaudited)
- --------------------------------------------------------------------------------------------------------------------------- Three Months Ended Nine Months Ended --------------------------------- --------------------------------- August 31, 1999 August 31, 1998 August 31, 1999 August 31, 1998 - --------------------------------------------------------------------------------------------------------------------------- INCOME Rental $8,445,000 $18,166,000 $45,899,000 $51,891,000 Interest 2,042,000 111,000 2,325,000 458,000 - --------------------------------------------------------------------------------------------------------------------------- Total income 10,487,000 18,277,000 48,224,000 52,349,000 - --------------------------------------------------------------------------------------------------------------------------- EXPENSES Property operating expenses 2,237,000 4,219,000 10,423,000 12,145,000 Real estate taxes 926,000 2,030,000 5,353,000 6,022,000 Depreciation and amortization 200,000 3,074,000 935,000 8,642,000 Unrealized loss on property held for sale 7,750,000 -- 8,950,000 -- Interest 1,066,000 2,635,000 5,956,000 7,627,000 General and administrative 853,000 999,000 2,706,000 2,713,000 Liquidation plan 10,991,000 430,000 12,774,000 430,000 - --------------------------------------------------------------------------------------------------------------------------- Total expenses 24,023,000 13,387,000 47,097,000 37,579,000 - --------------------------------------------------------------------------------------------------------------------------- Income (loss) before net gains (13,536,000) 4,890,000 1,127,000 14,770,000 Net gains 137,797,000 350,000 137,654,000 8,375,000 - --------------------------------------------------------------------------------------------------------------------------- Income before extraordinary item 124,261,000 5,240,000 138,781,000 23,145,000 Extraordinary item - prepayment of debt -- -- (286,000) -- - --------------------------------------------------------------------------------------------------------------------------- Net income $124,261,000 $5,240,000 $138,495,000 $23,145,000 =========================================================================================================================== PER SHARE DATA Basic earnings per share $9.02 $0.38 $10.06 $1.69 =========================================================================================================================== Diluted earnings per share $8.55 $0.37 $9.68 $1.65 =========================================================================================================================== Weighted average shares outstanding 13,774,221 13,760,024 13,773,163 13,728,003 ===========================================================================================================================
See accompanying notes to consolidated financial statements. -4- MGI PROPERTIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
Nine Months Ended ----------------------------------- August 31, 1999 August 31, 1998 - ----------------------------------------------------------------------------------------- CASH FLOWS FROM OPERATING ACTIVITIES Net income $138,495,000 $23,145,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 935,000 8,642,000 Unrealized loss on property held for sale 8,950,000 -- Net gain (137,654,000) (8,375,000) Extraordinary item 286,000 -- Other 8,555,000 (404,000) - ----------------------------------------------------------------------------------------- Net cash provided by operating activities 19,567,000 23,008,000 - ----------------------------------------------------------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of real estate (339,000) (57,140,000) Additions to real estate (1,299,000) (4,200,000) Tenant improvements (4,769,000) (2,020,000) Deferred tenant charges (1,384,000) (1,809,000) Net proceeds from sales of real estate 407,482,000 22,274,000 Short term investments over 90 days (19,709,000) -- Other 373,000 145,000 - ----------------------------------------------------------------------------------------- Net cash provided by (used in) investing activities 380,355,000 (42,750,000) - ----------------------------------------------------------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES Additions to loans payable, net -- 46,550,000 Repayment of loans payable (88,026,000) (17,663,000) Mortgage prepayment penalty (286,000) -- Cash distributions (270,800,000) (12,226,000) Proceeds from issuance of common shares 95,000 1,063,000 - ----------------------------------------------------------------------------------------- Net cash provided by (used in) financing activities (359,017,000) 17,724,000 - ----------------------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents 40,905,000 (2,018,000) - ----------------------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS Beginning of period 12,265,000 13,964,000 - ----------------------------------------------------------------------------------------- End of period $53,170,000 $11,946,000 =========================================================================================
See accompanying notes to consolidated financial statements. -5- MGI PROPERTIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (unaudited) - ------------------------------------------------------------------------------- Additional Common Paid-In Undistributed Shares Capital Net Income - ------------------------------------------------------------------------------- Balance at November 30, 1998 $13,764,000 $208,278,000 $ 34,780,000 Net income -- -- 138,495,000 Cash liquidating distributions -- -- (270,800,000) Options exercised 10,000 85,000 -- - ------------------------------------------------------------------------------- Balance at August 31, 1999 $13,774,000 $208,363,000 $ (97,525,000) =============================================================================== See accompanying notes to consolidated financial statements. -6- MGI PROPERTIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 1: The results of the interim period are not necessarily indicative of results to be expected for the entire fiscal year. The figures contained in this interim report are unaudited and may be subject to year-end adjustments. Certain prior year amounts have been reclassified to conform with the current year presentation. In the opinion of management, all adjustments necessary for a fair presentation of financial position and results of operations have been included and such adjustments include only the normal accruals. Note 2: The shareholders of MGI Properties ("MGI" or the "Trust") approved a Plan of Complete Liquidation and Termination of the Trust (the "Plan") at a special meeting held on October 14, 1998. The Plan calls for the sale of all of the Trust's assets. Net sales proceeds and available cash will be used to satisfy existing debts and obligations with remaining funds to be distributed to shareholders. Although it is expected that the Trust will continue to qualify as a REIT for the period prior to the distribution of MGI's assets to shareholders, no assurance can be given that the Trust will not lose or terminate its status as a REIT. Note 3: With shareholder approval of the Plan on October 14, 1998, the Trust reclassified its real estate assets to "properties held for sale" and on that date ceased depreciation of the assets and reclassified accumulated depreciation and amortization to the appropriate categories. On June 22, 1999, the Trust completed the sale of 53 New England properties totaling 4.4 million square feet and on July 1, 1999 the Trust completed the sale of a 178,600 square foot office building. The aggregate sales price of these two transactions totaled $421.4 million, which included $46.8 million of debt secured by certain properties that was repaid or assumed by the buyers. Subsequent to the close of the quarter, the Trust completed the sale of two apartment complexes, totaling 583 units, for an aggregate sales price of $39.8 million, which included $18.6 million of debt secured by the properties that was repaid or assumed by the buyers. Following these sales MGI currently owns 11 properties. As of the date of this report, MGI has entered into three agreements to sell four additional properties. The sales agreements are subject to the customary terms and conditions for transactions of this type, including the respective purchasers' satisfactory completion of due diligence, engineering and environmental inspections, and approval of titles and surveys. Of these four properties, the buyers for MGI's remaining apartment complex and its two office buildings in Greenville, South Carolina have completed their due diligence. These sales are expected to close later in MGI's fourth quarter, although there can be no assurance that any or all of them will be successfully completed. -7- MGI PROPERTIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 4: On June 22, 1999, the Board of Trustees declared a distribution of $19.00 per share. The distribution was paid to shareholders on July 30, 1999. This distribution aggregated $265 million. Since the October 14, 1998 liquidation vote, liquidating distributions total $19.66 per share. Under the provisions of the Internal Revenue Code, distributions made within 24 months of the adoption of the Plan are considered liquidating distributions and will not be dividend income when received by shareholders. Distributions in liquidation are first applied to reduce a shareholder's tax basis in his or her shares of MGI with the excess, if any, generally constituting a capital gain, short or long term, as applicable. Note 5: Following shareholder approval of the Plan on October 14, 1998, option holders, in accordance with their option agreements, have elected, as an alternative to exercising their options, to receive in cash the difference between the per share option exercise price and the aggregate per share net liquidation proceeds to be distributed to shareholders. Holders of approximately 1.5 million options, having an aggregate average exercise price of approximately $19.84, have made this election. The estimated expense associated with these elections, which is the difference between the per share option exercise price and the aggregate per share net liquidation proceeds expected to be distributed to shareholders, will be recognized upon declaration of the related liquidating distributions. In the third quarter of 1999, MGI recognized approximately $9.4 million of expense related to this election by option holders. This amount is included in Liquidation Plan expenses. Note 6: Cash applied to interest payments amounted to $1.2 million and $2.6 million for the three-month periods ended August 31, 1999 and 1998, respectively. At the time of the June 22, 1999 sale of 53 New England properties, MGI repaid all $36.0 million outstanding on its line of credit. Note 7: MGI intends to qualify for the year ending November 30, 1999 as a real estate investment trust under the provisions of Sections 856-860 of the Internal Revenue Code of 1986, as amended. Accordingly, no provision has been made for Federal income taxes. -8- MGI PROPERTIES PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview MGI is a self-administered equity REIT that is operating under a Plan of Complete Liquidation and Termination of the Trust. The shareholders of the Trust approved the Plan at a special meeting held on October 14, 1998. In connection with the Plan, MGI anticipates incurring a variety of costs and fees including costs related to sales, fees to advisors and other professionals, severance compensation, payments to holders of stock options, and other expenses related to liquidation. The Plan is discussed in the Trust's Form 10-K for the year ended November 30, 1998, and in the definitive Proxy Statement dated September 10, 1998, including risk factors, income tax consequences and certain other considerations. As part of that discussion, management estimated that substantially all of the properties would be sold within 12 to 15 months of shareholder adoption of the Plan. Through the nine months ended August 31, 1999, MGI completed the sale of 55 properties, of which 53 properties, totaling 4.4 million square feet, were located in New England. The aggregate sales price for these transactions were $422.5 million, which included $46.8 million of mortgage debt that was repaid or assumed by the buyers. Since the October 14, 1998 liquidation vote, liquidating distributions, including one of $19.00 per share paid on July 30, 1999, total $19.66 per share. At August 31, 1999, MGI owned 13 properties, which aggregated 1.1 million square feet of commercial space and 959 residential apartments. Subsequent to August 31, 1999, MGI sold two apartment complexes totaling 583 units, for an aggregate sales price of $39.8 million, which included $18.6 million of debt secured by the properties that was repaid or assumed by the buyers. Following these sales, MGI owns 11 properties. The 11 properties are being actively marketed with four properties currently under agreement. The sales agreements are subject to the customary terms and conditions, including the respective purchasers' satisfactory completion of due diligence, engineering and environmental inspections, and approval of titles and surveys. Of these four properties, the buyers for MGI's remaining apartment complex and its two office buildings in Greenville, South Carolina have completed their due diligence. These sales are expected to close later in MGI's fourth quarter, although there can be no assurance that all or any of them will be successfully completed. Liquidity and Capital Resources Shareholders' equity at August 31, 1999 was $124.6 million, compared to $256.8 million at November 30, 1998. The decrease primarily reflects the excess of distributions paid over net income. At August 31, 1999, financial liquidity was provided by $53.2 million in cash and cash equivalents and by $19.7 million in short term investments. -9- MGI PROPERTIES PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Loans payable totaled $34.6 million at August 31, 1999, a net decrease of $95.9 million compared to $130.5 million at November 30, 1998. During the nine months ended August 31, 1999, the Trust repaid a $12.3 million mortgage loan that was secured by an Aurora, Illinois retail center and another $46.8 of mortgage debt was repaid or assumed by the buyers of certain properties. Additionally, at the time of the June 22, 1999 sale of 53 New England properties, MGI repaid the $36.0 million balance outstanding on its $75 million line of credit and terminated the line. Scheduled loan principal payments associated with the remaining unsold properties due within 12 months of August 31, 1999 total $0.3 million. MGI has no debt which is scheduled to mature prior to the anticipated completion of the Plan. Cash requirements during the balance of fiscal 1999 may include distributions to shareholders, capital and tenant improvements and other leasing expenditures required to maintain MGI's occupancy levels and other investment undertakings. Currently, the Trust anticipates funding approximately $0.4 million of capital and tenant improvement projects associated with the remaining unsold properties. MGI anticipates meeting these obligations through the short term investments, cash and cash equivalents held at August 31, 1999 and through the net sale proceeds of its remaining assets. Results of Operations The sale of 54 properties pursuant to the Plan during the third quarter of 1999 created a fundamental transformation in MGI and is the primary factor in explaining the changes in operating results when 1999 is compared to prior periods. Net income for the fiscal quarter ended August 31, 1999 was $124.3 million, or $9.02 per share (basic), as compared to $5.2 million, or $.38 per share (basic), in the corresponding quarter of 1998. Net income for the nine months ended August 31, 1999, was $138.5 million, or $10.06 per share (basic), as compared to $23.1 million, or $1.69 per share (basic), a year ago. Included in the 1999 third quarter net income were net gains of $137.8 million, as compared to $0.4 million recognized a year ago. In connection with the 1999 sales, MGI incurred a variety of expenses including legal, transfer fees, state and other taxes, broker fees and fees to its financial advisor and property sales agent. For the nine months ended August 31, 1999, net gains approximated $137.7 million as compared to $8.4 million recognized from the sale of seven properties in the same nine-month period in 1998. Income before net gains and extraordinary item was $1.1 million and $14.8 million for the nine months ended August 31, 1999 and 1998, respectively. The $13.6 million and the $18.4 million decreases in income before net gain and extraordinary item when the nine months and the quarter ended August 31, 1999, respectively, are compared to the same periods in fiscal 1998 are directly attributable to the disposition of the 54 properties in the third quarter of 1999. These changes, when the third quarter of 1999 is compared to the third quarter of 1998, primarily resulted from the $10.6 million increase in Liquidation Plan expenses, the $7.8 million recognized as an unrealized loss on properties held for sale and a $6.6 million decrease ($5.3 million in 1999 versus $11.9 million in 1998) in property operating income (which is defined as rental income less property operating expenses and real estate taxes), which were partially offset by a $1.6 million reduction in interest expense, a $2.9 million decrease in depreciation and amortization and a $1.9 million increase in interest income. -10- MGI PROPERTIES PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) The $10.9 million in Liquidation Plan expenses is primarily comprised of $9.4 million related to the election made by option holders in lieu of exercising their options that was recognized and accrued and $1.4 million of employee severance compensation. In the third quarter of 1999, the Trust recognized an unrealized loss of $7.8 million, the amount by which the carrying value of certain properties exceeded their estimated fair value, according to management's estimate. This reevaluation occurred in connection with the Trust's decision to sell its remaining properties in single property sales and its evaluation of changing market conditions. Also reflecting the 1999 third quarter sale of 54 properties was the decrease in interest expense of $1.6 million due primarily to the approximate $96.1 million of debt that was repaid or assumed in connection with the sale of properties and higher interest income due to the amount of net sale proceeds held by MGI pending distribution to shareholders. Moreover, depreciation and amortization decreased by $2.9 million, as the Trust stopped depreciating its real estate assets on October 14, 1998, the date shareholders approved the Plan. The change in property operating income reflects a 7.9%, or a $0.2 million increase in income from "same store" properties owned throughout the third quarters of both fiscal 1999 and 1998, offset by the income effect of $6.9 million due to the sale of properties. With respect to the comparable properties, which, at August 31, 1999 totaled only 13 properties, the increase in property operating income primarily resulted from increased revenues at an Aurora, Illinois shopping center due to a lower vacancy rate. Change in Property Operating Income for Quarter Ended August 31, 1999 versus August 31, 1998 Properties Held 1999 and 1998 Both Fiscal Years Sales Net Change ----------------- ------------- ---------- Office $(25,000) $(3,011,000) $(3,036,000) Industrial -- (1,829,000) (1,829,000) Office R&D -- (1,920,000) (1,920,000) Apartment 46,000 -- 46,000 Retail 222,000 (44,000) 178,000 Land and Other (2,000) (71,000) (73,000) -------- ----------- ------------ $241,000 $(6,875,000) $(6,634,000) ======== ============ ============ The increase in property operating income of $0.9 million, or 10.0%, from the 13 properties held in both the nine months ended August 31, 1999 and 1998, was primarily due to leasing completed at the retail properties and increased rental income at the apartment complexes. Average occupancy for both nine-month periods was approximately 95%. -11- MGI PROPERTIES PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Schedule of portfolio leasing as of August 31, 1999 is as follows: Property Total Percentage Type Square Feet Leased ---- ----------- ------ Retail 715,200 98.0% Office 299,700 87.4% --------- Total 1,014,900 94.8% ========= There are no significant fiscal 1999 lease expirations associated with the Trust's remaining unsold properties. Funds from operations ("FFO") totaled $5.4 million in the third quarter of fiscal 1999, compared to $8.3 million in the corresponding quarter of 1998. The approximate $2.9 million decrease is attributable to the property sales that occurred in the third quarter of 1999. FFO for the nine months ended August 31, 1999 and 1998 was $23.7 million in each period. MGI calculates FFO in conformity with the NAREIT definition which is net income (computed in accordance with generally accepted accounting principles), excluding gains (or losses) from debt restructuring and sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures, and for significant non-recurring events (such as Liquidation Plan expenses). MGI believes FFO is an appropriate supplemental measure of operating performance. The following is a reconciliation of net income to FFO:
Three Months Ended Nine Months Ended ------------------ ----------------- August 31, 1999 August 31,1998 August 31, 1999 August 31, 1998 --------------- -------------- --------------- --------------- Net income $124,261,000 $5,240,000 $138,495,000 $23,145,000 Plus net loss/(less net gain) and extraordinary item (137,797,000) (350,000) (137,368,000) (8,375,000) Plus unrealized loss on property held for sale 7,750,000 -- 8,950,000 -- Plus building depreciation -- 2,347,000 -- 6,631,000 Plus tenant improvement and commission amortization 177,000 681,000 861,000 1,880,000 Plus liquidation plan expenses 10,991,000 430,000 12,774,000 430,000 ---------- ---------- ----------- ----------- FFO $5,382,000 $8,348,000 $23,712,000 $23,711,000 ========== ========== =========== ===========
-12- Forward Looking Statements Statements made or incorporated in this Report may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are dependent on a number of factors which could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Such factors include, among other things, the risks of future action or inaction by the Board of Trustees with respect to the Plan (and the actual results thereof), including the possibility of litigation pertaining thereto; the net realizable value and the timing of the sale of the Trust's remaining properties during the course of the liquidation; the amount and timing of liquidating distributions; changes in national and local economic and financial market conditions; the successful completion of the pending sales described in this Report, as well as those factors set forth in MGI's Form 10-K for the year ended November 30, 1998, including those set forth under "Forward-Looking Statements," "Other" and Item 1 - "Adoption of Liquidation Plan." -13- MGI PROPERTIES PART II - OTHER INFORMATION Item 1: Legal Proceedings: Not applicable. Item 2: Changes in Securities and Use of Proceeds: Not applicable. Item 3: Defaults upon Senior Securities: Not applicable. Item 4: None Item 5: Other Information: Not applicable. Item 6: Exhibits and Reports on Form 8-K: a) Exhibits: Part I - Exhibit 11 -- Computation of Earnings Per Share (see page 16). b) Reports on Form 8-K: Dated June 22, 1999, filed on June 23, 1999 Dated June 22, 1999, filed on July 7, 1999 -14- MGI PROPERTIES SIGNATURES Pursuant to the requirements to the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: October 15, 1999 /s/ Phillip C. Vitali ---------------- -------------------------------- Phillip C. Vitali Executive Vice President and Treasurer (Principal Financial and Accounting Officer) -15- EX-11 2 COMPUTATION OF EARNINGS PER SHARE Exhibit 11 MGI PROPERTIES PART I - EXHIBIT 11 COMPUTATION OF EARNINGS PER SHARE - --------------------------------------------------------------------------------
Three Months Ended August 31, Nine Months Ended August 31, ----------------------------- ---------------------------- 1999 1998 1999 1998 BASIC Net income $124,261,000 $5,240,000 $138,495,000 $23,145,000 ================================================================================================================================= Weighted average number of shares outstanding during the period 13,774,221 13,760,024 13,773,163 13,728,003 ================================================================================================================================= Basic earnings per share $9.02 $0.38 $10.06 $1.69 ================================================================================================================================= DILUTED EARNINGS PER SHARE Net income $124,261,000 $5,240,000 $138,495,000 $23,145,000 ================================================================================================================================= Weighted average number of shares outstanding assuming full dilution 14,535,038 14,098,903 14,310,825 14,026,394 ================================================================================================================================= Diluted earnings per share $8.55 $0.37 $9.68 $1.65 =================================================================================================================================
EX-27 3 FINANCIAL DATA SCHEDULE FOR THIRD QTR 10-Q
5 1,000 3-MOS NOV-30-1999 AUG-31-1999 53,170 19,709 722 000 000 4,643 93,913 000 172,157 12,916 34,629 13,774 000 000 110,838 172,157 8,445 10,487 000 22,957 000 000 1,066 (13,536) 000 (13,536) 137,797 000 000 124,261 9.02 8.55
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