-----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, SJ5jZC+JNYOZtWI3rjC9XWeBEC41WbgG4Q+TEOSgKiiulpQKwB/BXC65R1jFpIug KQOCterZQnVlXCvhloO33A== 0000950123-98-009297.txt : 19981030 0000950123-98-009297.hdr.sgml : 19981030 ACCESSION NUMBER: 0000950123-98-009297 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 19980731 FILED AS OF DATE: 19981029 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEW PLAN REALTY TRUST CENTRAL INDEX KEY: 0000071519 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 131995781 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: SEC FILE NUMBER: 001-08459 FILM NUMBER: 98732608 BUSINESS ADDRESS: STREET 1: 1120 AVE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10036 BUSINESS PHONE: 2128693000 MAIL ADDRESS: STREET 1: 1120 AVENUE OF THE AMERICAS STREET 2: 1120 AVENUE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10036 10-K405 1 NEW PLAN REALTY TRUST 1 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED EFFECTIVE OCTOBER 7, 1996] For the fiscal year ended July 31, 1998 OR | | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from to Commission File Number 1-8459 NEW PLAN REALTY TRUST (Exact Name of Registrant as Specified in Its Charter) MASSACHUSETTS 13-1995781 (State of Incorporation) (I.R.S. Employer Identification No.) 1120 AVENUE OF THE AMERICAS NEW YORK, NY 10036 (212) 869-3000 (Address of Principal Executive Offices) (Registrant's Telephone Number) Securities registered pursuant to Section 12(b) of the Act: SHARES OF BENEFICIAL INTEREST, NO PAR VALUE (Title of Class) NEW YORK STOCK EXCHANGE (Name of Exchange on Which Registered) Securities registered pursuant to Section 12(g) of the Act: NONE 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, and (2) has been subject to such filing requirements for the past 90 days. YES X NO ----- ----- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. |X| The aggregate market value of the voting stock held by non-affiliates of the Registrant was approximately $1,325,376,748 based on the closing price on the New York Stock Exchange for such stock on September 23, 1998. THE NUMBER OF SHARES OF THE REGISTRANT'S SHARES OF BENEFICIAL INTEREST OUTSTANDING AS OF SEPTEMBER 23, 1998 WAS 60,108,962. 2 TABLE OF CONTENTS ITEM NO. PAGE - -------- ---- PART I .....................................................................1 Item 1. Business.............................................................1 Item 2. Properties...........................................................5 Item 3. Legal Proceedings...................................................20 Item 4. Submission of Matters to a Vote of Security Holders.................20 PART II ....................................................................20 Item 5. Market for the Registrant's Common Equity and Related Shareholder Matters.................................................20 Item 6. Selected Financial Data.............................................23 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.................................24 Item 7A. Quantitative and Qualitative Disclosures About Market Risk .........31 Item 8. Financial Statements and Supplementary Data.........................31 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.................................31 PART III ....................................................................31 Item 10. Trustees and Executive Officers of the Trust .......................31 Item 11. Executive Compensation .............................................39 Item 12. Security Ownership of Certain Beneficial Owners and Management .....45 Item 13. Certain Relationships and Related Transactions .....................47 PART IV ....................................................................49 Item 14. Exhibits, Consolidated Financial Statements, Consolidated Financial Statement Schedules, and Reports on Form 8-K..............49 3 PART I This Form 10-K, together with other statements and information publicly disseminated by New Plan Realty Trust (the "Registrant" or the "Trust"), contains certain 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. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, performance or achievements, financial and otherwise, may differ materially from the results, performance or achievements expressed or implied by the forward-looking statements. Risks, uncertainties and other factors that might cause such differences, some of which could be material, include, but are not limited to: national and local economic, business and real estate and other market conditions; financing risks, such as the inability to obtain debt or equity financing on favorable terms; potential adverse effects of the Merger (as defined below), such as the inability to successfully integrate two previously separate companies; the level and volatility of interest rates; financial stability of tenants; the rate of revenue increases versus expense increases; governmental approvals, actions and initiatives; environmental/safety requirements; risks of real estate acquisition and development (including the failure of pending acquisitions to close and pending developments to be completed on time and within budget); as well as other risks listed from time to time in this Form 10-K and in the Company's other reports filed with the Securities and Exchange Commission or otherwise publicly disseminated by the Company. ITEM 1. BUSINESS (a) General Development of Business As of July 31, 1998, the Trust was a self-administered and self-managed equity real estate investment trust. The Trust was organized on July 31, 1972 as a business trust under the laws of the Commonwealth of Massachusetts. The Trust is the successor to the original registrant (Reg. No. 2-19671), New Plan Realty Corporation, which was incorporated under the laws of the State of Delaware on December 4, 1961. Since September 28, 1998, in connection with the Merger (as defined below), the Trust has been a wholly owned subsidiary of New Plan Excel Realty Trust, Inc. ("New Plan Excel"), a self-administered and self-managed equity real estate investment trust, which was incorporated under the laws of the State of California in 1985 and reincorporated as a Maryland corporation in July 1993. See " -- Narrative Description of Business -- Consummation of the Merger" below. (b) Financial Information About Industry Segments As of July 31, 1998, the Trust was in the business of managing, operating, leasing, acquiring, developing and investing in shopping centers, factory outlet centers and apartment communities. See the Consolidated Financial Statements and Notes thereto included in Item 8 of this Annual Report on Form 10-K for certain information required by Item 1. 4 Since September 28, 1998, the Trust has been in the business of managing, operating and leasing its existing portfolio of shopping centers, factory outlet centers and apartment communities. See " -- Narrative Description of the Business -- Acquisition, Financing and Operating Strategies" below. (c) Narrative Description of Business General As of July 31, 1998, the Trust owned, directly or through its subsidiaries, fee or leasehold interests in 136 shopping centers containing an aggregate of approximately 19.5 million square feet of gross leasable area ("GLA"), six factory outlet centers containing an aggregate of approximately 1.8 million square feet of GLA and 53 apartment communities containing approximately 12,700 units, primarily in the eastern half of the United States. The average occupancy rates as of July 31, 1998 for the shopping centers, factory outlet centers and apartment communities were approximately 91%, 91% and 92%, respectively. In addition, as of July 31, 1998, the Trust owned a mortgage interest in five shopping centers. The Trust maintains its executive offices at 1120 Avenue of the Americas, New York, New York 10036, and its telephone number is (212) 869-3000. Acquisition, Financing and Operating Strategies As of July 31, 1998, the Trust's primary investment strategy was to identify and purchase well-located income-producing shopping centers and apartment communities at a discount to replacement cost. The Trust also purchased or developed selected factory outlet centers. The Trust sought to achieve income growth and enhance the cash flow potential of its properties through a program of expansion, renovation, leasing, re-leasing and improving the tenant mix. The Trust minimized development risks by generally purchasing existing income-producing properties. The Trust regularly reviewed its portfolio and from time to time considered the sale of certain of its properties. As a result of the consummation of the Merger on September 28, 1998, the Trust currently seeks to achieve income growth and enhance the cash flow potential of its properties through a program of expansion, renovation, leasing, re-leasing and improving the tenant mix. It is expected that future acquisitions and developments of, and investments in, shopping centers, factory outlet centers and apartment communities will be done by New Plan Excel directly, rather than through the Trust (although the Trust is not precluded from making future acquisitions and developments of, or investments in, properties). The Trust, however, will regularly review its portfolio and from time to time consider the sale of certain of its properties. The Trust has generally acquired properties for cash. In a few instances, properties were acquired subject to existing mortgages. Long-term debt of the Trust as of July 31, 1998 consisted of $114.1 million of mortgages having a weighted average interest rate of 7.8% and $462.8 million aggregate principal amount of unsecured notes having a weighted average interest rate of 6.9%. The Trust's short-term debt consists of normal trade accounts payable and the current portion of mortgages payable. As of July 31, 1998, there was no outstanding balance under the Trust's $50 million unsecured line of credit with The Bank of New York, Bank Hapoalim B.M. and Fleet National Bank. As of October 16, 1998, the outstanding balance under the line of credit was $50 million. 2 5 As of July 31, 1998, virtually all operating and administrative functions, such as leasing, data processing, finance, accounting, construction and legal, were centrally managed at the Trust's headquarters. In addition, the Trust maintained regional offices located near its various properties. On-site functions such as security, maintenance, landscaping and other similar activities were either performed by the Trust or subcontracted. The cost of these functions was passed through to tenants to the extent permitted by the respective leases. As a result of the consummation of the Merger on September 28, 1998, virtually all operating and administrative functions, such as leasing, data processing, finance, accounting, construction and legal, are now managed at the Trust's executive and operational headquarters in New York, New York and the Trust's operational headquarters in San Diego, California. The Trust continues to maintain field offices and regional offices located near its various properties. On-site functions such as security, maintenance, landscaping and other similar activities are either performed by the Trust or subcontracted. The cost of these functions are passed through to tenants to the extent permitted by the respective leases. Developments During the 1998 Fiscal Year In the fiscal year ended July 31, 1998, the Trust acquired 14 shopping centers containing an aggregate of approximately 1.9 million square feet of GLA and five apartment communities containing approximately 1,600 units. The newly acquired properties are located in Florida, Georgia, Indiana, Michigan, Nevada, New Jersey, New York, North Carolina, Ohio, Tennessee and Virginia. The aggregate purchase price for these properties, including assumed mortgages, was approximately $157 million. Between July 31, 1998 and September 30, 1998, the Trust purchased an apartment community containing 278 units in North Carolina, as well as a single tenant retail property containing approximately 34,000 square feet of GLA in Pennsylvania. The aggregate purchase price for these properties was approximately $14.2 million. Gross revenues, net income and funds from operations of the Trust for the fiscal year ended July 31, 1998 were the largest in the Trust's history. Funds from operations ("FFO") applicable to common shares of beneficial interest, no par value, of the Trust ("Common Shares"), defined as net income plus depreciation and amortization of real estate, less gains from sales of assets and securities, less distribution requirements with respect to preferred shares of the Trust, was approximately $116.4 million. Consummation of the Merger On September 28, 1998, Excel Realty Trust, Inc. ("Excel") and the Trust consummated a previously announced merger pursuant to an Agreement and Plan of Merger dated as of May 14, 1998, as amended as of August 7, 1998 (the "Merger Agreement"), whereby ERT Merger Sub, Inc., a wholly owned subsidiary of Excel, was merged with and into the Trust with the Trust surviving as a wholly owned subsidiary of Excel (the "Merger"). The Merger was approved by the stockholders of Excel and the shareholders of the Trust at special meetings held on September 25, 1998. In connection with the consummation of the Merger, Excel changed its name from "Excel Realty Trust, Inc." to "New Plan Excel Realty Trust, Inc." As provided in the Merger Agreement, Excel paid a 20% stock dividend prior to the Merger. Upon consummation of the Merger, each Common Share of the Trust was converted into one share of common stock, par value $.01 per share, of New Plan Excel ("New Plan Excel Common Stock"), and 3 6 each 7.8% Series A Cumulative Step-Up Premium Rate Preferred Share, par value $1.00 per share, of the Trust was converted into one share of 7.8% Series D Cumulative Voting Step-Up Premium Rate Preferred Stock, par value $.01 per share, of New Plan Excel ("New Plan Excel Series D Preferred Stock"). New Plan Excel issued an aggregate of approximately 60,000,000 shares of New Plan Excel Common Stock and 150,000 shares of New Plan Excel Series D Preferred Stock (represented by 1,500,000 depositary shares, each of which represents a one-tenth fractional interest in a share of New Plan Excel Series D Preferred Stock) to the Trust's shareholders in the Merger. The New Plan Excel Common Stock is listed for trading on the New York Stock Exchange under the symbol "NXL." As further provided in the Merger Agreement, effective September 28, 1998, the Board of Trustees of the Trust and the Board of Directors of New Plan Excel consist of the six former members of Excel's Board and the nine former members of the Trust's Board. Effective September 28, 1998, the senior management of the Trust and New Plan Excel is as follows: William Newman Chairman Arnold Laubich Chief Executive Officer Gary B. Sabin President and Chairman of Investment Committee James M. Steuterman Executive Vice President and Co-Chief Operating Officer Richard B. Muir Executive Vice President and Co-Chief Operating Officer David A. Lund Chief Financial Officer
New Plan Excel intends and expects that Mr. Laubich will eventually succeed Mr. Newman as Chairman of New Plan Excel, at such time as Mr. Newman is no longer serving in such capacity, and that Mr. Sabin will eventually succeed Mr. Laubich as Chief Executive Officer of New Plan Excel, at such time as Mr. Laubich is no longer serving in such capacity. In connection with the consummation of the Merger, on September 28, 1998, the Trust guaranteed the borrowings of New Plan Excel under New Plan Excel's revolving credit facility. Competition The success of the Trust depends, among other factors, upon the trends of the economy, including interest rates, income tax laws, increases or decreases in operating expenses, governmental regulations and legislation, including environmental requirements, real estate fluctuations, retailing trends, population trends, zoning laws, the financial condition and stability of tenants, the availability of financing and capital on satisfactory terms, the ability of the Trust to compete with others for tenants and keep its properties leased at profitable levels and construction costs. As of July 31, 1998, the Trust competed for properties with an indeterminate number of investors, including domestic and foreign corporations and financial institutions, other real estate investment trusts, life insurance companies, pension funds and trust funds. As a result of the consummation of the Merger on September 28, 1998, it is expected that future acquisitions and developments of, and investments in, properties will be done by New Plan Excel directly, rather than through the Trust (although the Trust is not precluded from making future acquisitions and developments of, or investments in, properties). Adverse changes in general or local economic conditions could result in the inability of some existing tenants of the Trust to meet their lease obligations and could otherwise adversely affect the Trust's ability to attract or retain tenants. Management believes, however, that the Trust's financial strength and operating practices, particularly its ability to implement renovation, expansion and leasing programs, will enable it to maintain and increase rental income from its properties. 4 7 Employees As of July 31, 1998, the Trust and its subsidiaries employed approximately 600 individuals (including executive, administrative and field personnel). As of such date, the Trust considered its relations with its personnel to be good. As a result of the consummation of the Merger, as of September 28, 1998, New Plan Excel and its subsidiaries (including the Trust) employed approximately 750 individuals (including executive, administrative and field personnel). Qualification as a Real Estate Investment Trust As of July 31, 1998, the Trust met the qualification requirements of a real estate investment trust under Sections 856-858 of the Internal Revenue Code of 1986, as amended (the "Code"). As a result, the Trust was not taxed on its REIT taxable income, at least 95% of which was distributed to shareholders. See Item 5 below. As a result of the consummation of the Merger, since September 28, 1998, the Trust has been a wholly owed subsidiary of New Plan Excel and, therefore, the Trust is a disregarded entity for federal income tax purposes. ITEM 2. PROPERTIES The location, general character and primary occupancy information with respect to the Trust's properties as of July 31, 1998 are set forth on the Summary of Properties Schedule on the pages immediately following. 5 8 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Apartments ---------- BRECKENRIDGE APARTMENTS 120 7 Fee 93 BIRMINGHAM AL DEVONSHIRE PLACE 284 16 Fee 88 BIRMINGHAM AL COURTS AT WILDWOOD 220 22 Fee 84 BIRMINGHAM AL THE CLUB APARTMENTS 292 23 Fee 87 BIRMINGHAM AL PLANTATION APARTMENTS 120 6 Fee 97 MOBILE AL MAISON DE VILLE APTS 347 20 Fee 97 MOBILE AL MAISON IMPERIAL APTS 56 6 Fee 93 MOBILE AL KNOLLWOOD APARTMENTS 704 43 Fee 97 MOBILE AL HILLCREST APARTMENTS 140 7 Fee 99 MOBILE AL RODNEY APARTMENTS 207 11 Fee 86 DOVER DE MAYFAIR APARTMENTS 96 7 Fee 93 DOVER DE CHARTER POINTE APARTMENTS 312 20 Fee 95 ALTAMONTE SPRINGS FL LAKE PARK APARTMENTS 226 10 Fee 97 LAKE PARK FL CAMBRIDGE APARTMENTS 180 12 Fee 91 ATHENS GA TARA APARTMENTS 240 19 Fee 85 ATHENS GA
6 9 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Apartments ---------- REGENCY CLUB APARTMENTS 232 17 Fee 96 EVANSVILLE IN HAWTHORNE HEIGHTS APTS 241 15 Fee 90 INDIANAPOLIS IN FOREST HILLS APARTMENTS 420 22 Fee 89 INDIANAPOLIS IN JAMESTOWN APARTMENTS 125 8 Fee 93 LEXINGTON KY SADDLEBROOK APARTMENTS 456 20 Fee 85 LEXINGTON KY POPLAR LEVEL APARTMENTS 88 3 Fee 99 LOUISVILLE KY LA FONTENAY APARTMENTS 248 17 Fee 92 LOUISVILLE KY CHARLESTOWN @ DOUGLASS HILLS 244 17 Fee 95 LOUISVILLE KY RIVERCHASE APARTMENTS 203 5 Fee 89 NEWPORT KY SHERWOOD ACRES APARTMENTS 612 26 Fee 85 BATON ROUGE LA FORESTWOOD APARTMENTS 272 11 Fee 96 BATON ROUGE LA WILLOW BEND LAKE APARTMENTS 360 25 Fee 89 BATON ROUGE LA DEERHORN VILLAGE APARTMENTS 309 36 Fee 98 KANSAS CITY MO CARDINAL WOODS APARTMENTS 184 17 Fee 96 CARY NC MEADOW EAST APARTMENTS 100 15 Fee 84 POTSDAM NY
7 10 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Apartments ---------- MOHAWK GARDEN APARTMENTS 208 12 Fee 88 ROME NY SPRING CREEK APARTMENTS 288 19 Fee 97 COLUMBUS OH NORTHGATE APARTMENTS 316 21 Fee 93 COLUMBUS OH ARLINGTON VILLAGE APARTMENTS 164 10 Fee 98 FAIRBORN OH CHESTERFIELD APARTMENTS 104 9 Fee 90 MAUMEE OH EASTGREEN ON THE COMMONS APTS. 360 45 Fee 95 REYNOLDSBURG OH GOLDCREST APARTMENTS 173 9 Fee 98 SHARONVILLE OH CAMBRIDGE PARK APTS 196 14 Fee 93 UNION TWP-CINN OH GOVERNOUR'S PLACE APARTMENTS 130 9 Fee 95 HARRISBURG PA HARBOUR LANDING APARTMENTS 208 15 Fee 92 COLUMBIA SC SEDGEFIELD APARTMENTS 280 19 Fee 93 FLORENCE SC TURTLE CREEK APARTMENTS 152 13 Fee 84 GREENVILLE SC HICKORY LAKE APARTMENTS 322 26 Fee 93 ANTIOCH TN COURTS @ WATERFORD PLACE 318 27 Fee 91 CHATTANOOGA TN ASHFORD PLACE APARTMENTS 268 16 Fee 83 CLARKSVILLE TN
8 11 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Apartments ---------- THE PINES APARTMENTS 224 11 Fee 94 CLARKSVILLE TN CEDAR VILLAGE APARTMENTS 170 11 Fee 92 CLARKSVILLE TN PADDOCK PLACE APARTMENTS 240 11 Fee 88 CLARKSVILLE TN LANDMARK ESTATES APARTMENTS 93 9 Fee 95 EAST RIDGE TN MILLER CREST APARTMENTS 121 16 Fee 98 JOHNSON CITY TN CEDAR BLUFF APARTMENTS 192 32 Fee 93 KNOXVILLE TN COUNTRY PLACE APARTMENTS 312 27 Fee 91 NASHVILLE TN WOODBRIDGE APARTMENTS 220 19 Fee 93 NASHVILLE TN Factory Outlets --------------- FACTORY MERCHANTS BARSTOW 334,000 49 Fee 95 BARSTOW CA ST AUGUSTINE OUTLET CENTER 335,000 32 Fee 95 ST AUGUSTINE FL FACTORY MERCHANTS BRANSON 317,000 39 Fee 84 BRANSON MO Leasehold FACTORY OUTLET VILLAGE OSAGE BE 400,000 147 Fee 97 OSAGE BEACH MO SIX FLAGS FACTORY OUTLET 190,000 55 Fee 100 JACKSON NJ FACTORY MERCHANTS FT CHISWELL 176,000 55 Fee 68 MAX MEADOWS VA
9 12 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Miscellaneous ------------- PIZZA HUT - PAD 4,000 1 Fee 100 GREENVILLE NC HARDEES - PAD 4,000 1 Leasehold 100 HANOVER PA PIZZA HUT - PAD 3,000 1 Leasehold 100 HARRISONBURG VA Office Building --------------- INSTITUTE FOR DEFENSE ANALYSIS 51,000 8 Leasehold 100 PRINCETON NJ Shopping Centers ---------------- CLOVERDALE VILLAGE 59,000 6 Fee 100 FLORENCE AL RODNEY VILLAGE 216,000 15 Fee 82 DOVER DE DOVERAMA @ RODNEY VILLAGE 30,000 1 75% Owned 100 DOVER DE REGENCY PARK SHOPPING CENTER 328,000 30 Fee 94 JACKSONVILLE FL
10 13 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- SOUTHGATE SHOPPING CENTER 263,000 24 Fee 94 NEW PORT RICHIE FL PRESIDENTIAL PLAZA 67,000 6 Fee 99 NORTH LAUDERDALE FL PRESIDENTIAL PLAZA WEST 21,000 2 Fee 80 NORTH LAUDERDALE FL COLONIAL MARKETPLACE 129,000 10 Fee 100 ORLANDO FL RIVERWOOD SHOPPING CENTER 94,000 15 Fee 98 PORT ORANGE FL SEMINOLE PLAZA 144,000 12 Fee 85 SEMINOLE FL RUTLAND PLAZA 150,000 13 Fee 100 ST PETERSBURG FL ALBANY PLAZA 114,000 7 Fee 97 ALBANY GA SOUTHGATE PLAZA - ALBANY 60,000 5 Fee 100 ALBANY GA PERLIS PLAZA 166,000 20 Fee 90 AMERICUS GA EASTGATE PLAZA - AMERICUS 44,000 4 Fee 100 AMERICUS GA ROGERS PLAZA 50,000 5 Fee 72 ASHBURN GA SWEETWATER VILLAGE 66,000 7 Fee 94 AUSTELL GA CEDARTOWN SHOPPING CENTER 107,000 14 Fee 100 CEDARTOWN GA CEDAR PLAZA 83,000 9 Fee 100 CEDARTOWN GA
11 14 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- CORDELE SQUARE 131,000 11 Fee 89 CORDELE GA SOUTHGATE PLAZA - CORDELE 39,000 3 Fee 92 CORDELE GA MR B'S 14,000 1 Fee 38 CORDELE GA HABERSHAM VILLAGE 147,000 18 Fee 99 CORNELIA GA MIDWAY VILLAGE SHOPPING CENTER 72,000 10 Fee 92 DOUGLASVILLE GA WESTGATE - DUBLIN 191,000 35 Fee 80 DUBLIN GA NEW CHASTAIN CORNERS SHOPPING C 109,000 13 Fee 100 MARIETTA GA VILLAGE AT SOUTHLAKE 53,000 6 Fee 98 MORROW GA CREEKWOOD SHOPPING CENTER 70,000 9 Fee 100 REX GA VICTORY SQUARE 171,000 35 Fee 99 SAVANNAH GA EISENHOWER SQUARE SHOPPING CENT 125,000 12 Fee 94 SAVANNAH GA TIFT-TOWN 61,000 4 Fee 78 TIFTON GA WESTGATE - TIFTON 16,000 2 Fee 92 TIFTON GA HAYMARKET SQUARE 267,000 28 Fee 94 DES MOINES IA HAYMARKET MALL 234,000 22 Fee 67 DES MOINES IA
12 15 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- SOUTHFIELD PLAZA SHOPPING CTR 193,000 18 Fee 70 BRIDGEVIEW IL WESTRIDGE COURT SHOPPING CTR 446,000 50 Fee 97 NAPERVILLE IL TINLEY PARK PLAZA 283,000 21 Fee 96 TINLEY PARK IL COLUMBUS CENTER 272,000 24 Fee 88 COLUMBUS IN JASPER MANOR 194,000 26 Fee 97 JASPER IN TOWN FAIR SHOPPING CENTER 114,000 16 Fee 100 PRINCETON IN WABASH CROSSING 167,000 18 Fee 97 WABASH IN JACKSON VILLAGE 147,000 48 Fee 72 JACKSON KY J*TOWN CENTER 187,000 17 Fee 86 JEFFERSONTOWN KY NEW LOUISA PLAZA 115,000 20 Fee 85 LOUISA KY PICCADILLY SQUARE 96,000 13 Fee 89 LOUISVILLE KY EASTGATE SHOPPING CENTER 153,000 18 Fee 88 MIDDLETOWN KY LIBERTY PLAZA 216,000 26 Fee 85 RANDALLSTOWN MD SHOPPING CENTER - SALISBURY 110,000 16 Fee 35 SALISBURY MD MAPLE VILLAGE SHOPPING CENTER 281,000 32 Fee 95 ANN ARBOR MI
13 16 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- FARMINGTON CROSSROADS 84,000 8 Fee 100 FARMINGTON MI DELTA CENTER 174,000 16 Fee 97 LANSING MI HAMPTON VILLAGE CENTRE 460,000 79 Fee 99 ROCHESTER HILLS MI FASHION CORNERS 189,000 15 Fee 72 SAGINAW MI Leasehold HALL ROAD CROSSING 176,000 27 Fee 100 SHELBY MI SOUTHFIELD PLAZA 107,000 9 Fee 100 SOUTHFIELD MI DELCO PLAZA 155,000 15 Fee 100 STERLING HEIGHTS MI WASHTENAW FOUNTAIN PLAZA 136,000 12 Fee 100 YPSILANTI MI SHOPPING CENTER - GOLDSBORO 80,000 10 Fee 100 GOLDSBORO NC SHOPPING CENTER - WILSON 105,000 17 Fee 76 WILSON NC LAUREL SQUARE 246,000 35 Fee 97 BRICKTOWN NJ HAMILTON PLAZA 149,000 18 Fee 99 HAMILTON NJ BENNETTS MILLS PLAZA 102,000 13 Fee 100 JACKSON NJ MIDDLETOWN PLAZA 123,000 19 Fee 82 MIDDLETOWN NJ TINTON FALLS PLAZA 101,000 7 Fee 99 TINTON FALLS NJ
14 17 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- RENAISSANCE CENTER EAST 146,000 15 Fee 99 LAS VEGAS NV UNIVERSITY MALL 79,000 25 Fee 81 CANTON NY CORTLANDVILLE 100,000 13 Fee 95 CORTLAND NY KMART PLAZA 116,000 11 Fee 100 DEWITT NY D & F PLAZA 192,000 30 Fee 57 DUNKIRK NY SHOPPING CENTER - ELMIRA 54,000 5 Fee 100 ELMIRA NY PYRAMID MALL 233,000 37 Fee 81 GENEVA NY SHOPPING CENTER - GLOVERSVILLE 45,000 4 Fee 100 GLOVERSVILLE NY MCKINLEY PLAZA 93,000 20 Fee 94 HAMBURG NY CAYUGA PLAZA 208,000 22 Fee 97 ITHACA NY SHOPS @ SENECA MALL 237,000 30 Fee 87 LIVERPOOL NY TRANSIT ROAD PLAZA 138,000 15 Fee 91 LOCKPORT NY SHOPPING CENTER - MARCY 123,000 21 Fee 2 MARCY NY WALLKILL PLAZA 203,000 24 Fee 100 MIDDLETOWN NY MONROE SHOPRITE PLAZA 122,000 12 Fee 100 MONROE NY
15 18 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- ROCKLAND PLAZA 260,000 28 Fee 97 NANUET NY SOUTH PLAZA 144,000 36 Fee 78 NORWICH NY WESTGATE PLAZA - ONEONTA 72,000 11 Fee 97 ONEONTA NY OSWEGO PLAZA 128,000 20 Fee 90 OSWEGO NY MOHAWK ACRES 107,000 13 Fee 75 ROME NY MONTGOMERY WARD 84,000 7 Fee 0 ROME NY PRICE CHOPPER PLAZA 78,000 6 Fee 100 ROME NY WESTGATE MANOR PLAZA - ROME 66,000 15 Fee 91 ROME NY NORTHLAND 123,000 23 Fee 92 WATERTOWN NY HARBOR PLAZA 52,000 7 Fee 78 ASHTABULA OH BELPRE PLAZA 88,000 8 Leasehold 96 BELPRE OH SOUTHWOOD PLAZA 83,000 44 Fee 95 BOWLING GREEN OH BRENTWOOD PLAZA 235,000 20 Fee 64 CINCINNATI OH DELHI SHOPPING CENTER 166,000 15 Fee 91 CINCINNATI OH WESTERN VILLAGE SHOPPING CENTER 139,000 13 Fee 100 CINCINNATI OH
16 19 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- CROWN POINT SHOPPING CENTER 147,000 16 Fee 91 COLUMBUS OH SOUTH TOWNE CENTRE 309,000 29 Fee 100 DAYTON OH HERITAGE SQUARE 232,000 29 Fee 91 DOVER OH MIDWAY CROSSING 139,000 15 Fee 82 ELYRIA OH FAIRFIELD MALL 73,000 9 Fee 95 FAIRFIELD OH SILVER BRIDGE PLAZA 146,000 20 Fee 93 GALLIPOLIS OH SHOPPING CENTER - GENOA 17,000 2 Fee 85 GENOA OH PARKWAY PLAZA 141,000 12 Fee 76 MAUMEE OH NEW BOSTON SHOPPING CENTER 234,000 22 Fee 100 NEW BOSTON OH MARKET PLACE 169,000 18 Fee 88 PIQUA OH BRICE PARK SHOPPING CENTER 174,000 15 Fee 100 REYNOLDSBURG OH CENTRAL AVE MARKET PLACE 157,000 18 Fee 91 TOLEDO OH GREENTREE SHOPPING CENTER 129,000 13 Fee 95 UPPER ARLINGTON OH BETHEL PARK PLAZA 224,000 23 Fee 100 BETHEL PARK PA DILLSBURG SHOPPING CENTER 69,000 22 Fee 100 DILLSBURG PA
17 20 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- NEW GARDEN SHOPPING CENTER 149,000 19 Fee 70 KENNETT SQUARE PA STONEMILL PLAZA 96,000 21 Fee 88 LANCASTER PA CROSSROADS PLAZA 105,000 14 Fee 98 MT. PLEASANT PA STRAWBRIDGE'S 313,000 Fee (A) 100 PHILADELPHIA PA ROOSEVELT MALL NE 250,000 36 Leasehold (A) 95 PHILADELPHIA PA IVYRIDGE SHOPPING CENTER 112,000 9 Fee 100 PHILADELPHIA PA ROOSEVELT MALL ANNEX 36,000 Fee (A) 100 PHILADELPHIA PA ST MARY'S PLAZA 108,000 11 Fee 100 ST MARY'S PA NORTHLAND CENTER 105,000 15 Fee 100 STATE COLLEGE PA Leasehold SHOPS AT PROSPECT 63,000 9 Fee 94 WEST HEMPFIELD PA YORK MARKETPLACE 259,000 34 Fee 100 YORK PA Leasehold CONGRESS CROSSING 172,000 39 Fee 100 ATHENS TN WEST TOWNE SQUARE SHOPPING CENT 99,000 11 Fee 76 ELIZABETHTON TN GREENEVILLE COMMONS 223,000 26 Fee 99 GREENEVILLE TN KINGS GIANT SHOPPING CENTER 162,000 18 Leasehold 100 KINGSPORT TN
- ---------- (A) Acreage of these properties have been included in the acreage of Roosevelt Mall NE. The leasehold was purchased by the Trust in August 1998. 18 21 NEW PLAN REALTY TRUST AND SUBSIDIARIES Summary of Properties At July 31, 1998
Description ------------------------- Type of Percent Property Sq. Ft. Units Acres Interest Rented -------- ------- ----- ----- -------- ------- Shopping Centers ---------------- GEORGETOWN SQUARE 104,000 11 Fee 96 MURFREESBORO TN SHOPPING CENTER - COLONIAL HTS 82,000 10 Fee 0 COLONIAL HEIGHTS VA HANOVER SQUARE SHOPPING CENTER 130,000 14 Fee 95 MECHANICSVILLE VA VICTORIAN SQUARE 271,000 34 Fee 99 MIDLOTHIAN VA CAVE SPRING CORNERS SHOPPING CTR 171,000 16 Fee 100 ROANOKE VA HUNTING HILLS SHOPPING CENTER 166,000 15 Fee 98 ROANOKE VA SHOPPING CENTER - SPOTSYLVANIA 87,000 8 Fee 100 SPOTSYLVANIA VA LAKE DRIVE PLAZA 148,000 14 Fee 79 VINTON VA RIDGEVIEW CENTRE 177,000 30 Fee 96 WISE VA MOUNDSVILLE PLAZA 172,000 29 Fee 90 MOUNDSVILLE WV GRAND CENTRAL PLAZA 74,000 7 Leasehold 100 PARKERSBURG WV KMART PLAZA 106,000 14 Fee 100 VIENNA WV Vacant Land ----------- ROXBURY TOWNSHIP NJ 6 Fee ROXBURY NJ 1 NORTH CENTRAL AVENUE 1 Fee HARTSDALE NY
19 22 ITEM 3. LEGAL PROCEEDINGS The Trust is not presently involved in any material litigation nor, to its knowledge, is any material litigation threatened against the Trust or its properties, other than litigation arising in the ordinary course of business or which is expected to be covered by the Trust's liability insurance. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matter was submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report. PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS (a) Market Information The following table shows the high and low sales price for the Trust's Common Shares, on the New York Stock Exchange, and, prior to June 12, 1986, on the American Stock Exchange, as well as cash distributions paid, for the periods indicated. Figures are adjusted to give effect to a 2-for-1 stock split on February 1, 1983 and a 3-for-2 stock split on April 1, 1986. In connection with the consummation of the Merger, on September 28, 1998, the Trust became a wholly owned subsidiary of New Plan Excel, and the Common Shares ceased trading on the New York Stock Exchange after the close of trading on that date. As a result, there is currently no established public trading market for the Common Shares. 20 23
Fiscal Year Ended Cash Distributions July 31, High Low Paid per Common Share ----------------- ---- --- --------------------- 1984 $ 8.50 $ 7.25 $ .57 1985 11.92 7.50 .65 1986 14.50 10.00 .73 1987 18.38 13.00 .81 1988 17.63 10.75 .89 1989 17.88 14.38 .97 1990 19.13 14.88 1.05 1991 21.25 13.75 1.13 1992 25.00 19.63 1.21 1993 26.38 21.50 1.275 1994 26.38 20.38 1.315 1995 22.63 18.75 1.355 1996 23.00 19.88 1.395 1997 First Quarter 22.00 21.13 .3550 Second Quarter 25.63 21.63 .3575 Third Quarter 24.50 21.38 .3600 Fourth Quarter 23.63 21.50 .3625 -------- TOTAL 1.435 1998 First Quarter 24.75 22.57 .3650 Second Quarter 26.00 23.57 .3675 Third Quarter 26.13 24.00 .3700 Fourth Quarter 25.63 22.25 .3725 -------- TOTAL 1.475
(b) Holders As of September 11, 1998, the approximate number of record holders of the Trust's Common Shares (the only class of common equity) was 13,700. In connection with the consummation of the Merger on September 28, 1998, the Trust became a wholly owned subsidiary of New Plan Excel. As a result, New Plan Excel is currently the only record holder of Common Shares. 21 24 (c) Distributions The Trust made distributions to shareholders aggregating $1.475 per Common Share during the fiscal year ended July 31, 1998. Of this distribution, it is estimated that $1.413 will qualify as ordinary income and $.062 will qualify as a return of capital. The Trust has paid regular and uninterrupted cash distributions on its Common Shares since it commenced operations as a REIT in 1972. Since inception, each distribution has either been equal to or greater than the distribution immediately preceding it, and the distributions have increased in each of the last 77 consecutive quarters. As a result of the consummation of the Merger, since September 28, 1998, all of the Common Shares have been held by New Plan Excel. The Trust will make quarterly distributions on its Common Shares as, if and when declared by the Board of Trustees of the Trust. As of July 31, 1998, the Trust had a Dividend Reinvestment and Share Purchase Plan (the "Plan") which allowed shareholders to acquire additional Common Shares by automatically reinvesting distributions. Common Shares were acquired pursuant to the Plan at a price equal to 95% of the market price of such Common Shares, without payment of any brokerage commission or service charge. The Plan also allowed shareholders to purchase additional Common Shares on the dividend payment date, at 100% of the average of the high and low sales price of such Common Shares on that date. In connection with the consummation of the Merger, on September 28, 1998, the Trust became a wholly owned subsidiary of New Plan Excel, and, as a result, the Plan was effectively terminated. 22 25 ITEM 6. SELECTED FINANCIAL DATA The financial data included in this table have been selected by the Trust and have been derived from the consolidated financial statements for the years indicated and should be read in conjunction with the audited financial statements included in Item 14(a) of this Form 10-K.
NEW PLAN REALTY TRUST AND SUBSIDIARIES Years Ended July 31, (In Thousands, Except for Per Share Amounts) 1998 1997 1996 1995 1994 ---- ---- ---- ---- ---- Statement of Income Data: Revenue $ 250,259 $ 206,821 $ 167,606 $ 130,576 $ 100,955 Operating Expenses 156,875 127,578 94,868 65,572 46,914 ------------ ------------ ------------ ------------ ------------ 93,384 79,243 72,738 65,004 54,041 (Loss)/Gain on Sales of properties and securities, net (41) (3) 399 228 989 ------------ ------------- ------------ ------------ ------------ 93,343 79,240 73,137 65,232 55,030 Other deductions 2,770 2,203 2,616 2,516 2,713 ------------ ------------ ------------ ------------ ------------ Net Income $ 90,573 $ 77,037 $ 70,521 $ 62,716 $ 52,317 ============ ============ ============ ============ ============ Net Income per Common Share Basic $ 1.43 $ 1.31 $ 1.25 $ 1.19 $ 1.06 Diluted $ 1.42 $ 1.30 $ 1.25 $ 1.18 $ 1.05 Weighted average number of Common Shares outstanding Basic 59,365 58,461 56,484 52,894 49,502 Diluted 59,774 58,735 56,642 53,040 49,768 Balance Sheet Data: Total Assets $ 1,384,525 $ 1,261,144 $ 945,394 $ 796,636 $ 616,993 Long-Term Debt Obligations $ 576,888 $ 478,207 $ 238,426 $ 206,652 $ 28,060 Shareholders' Equity $ 764,527 $ 744,995 $ 659,354 $ 570,529 $ 565,493 Other Data: Distributions per Common Share $ 1.475 $ 1.435 $ 1.395 $ 1.355 $ 1.315 ------------ ------------- ------------- ------------- ------------- FFO per Common Share (diluted)(1) $ 1.95 $ 1.73 $ 1.59 $ 1.46 $ 1.26 ------------ ------------- ------------- ------------- -------------
- ----------------------------- (1) Represents FFO less distribution requirements with respect to preferred shares of the Trust. FFO is defined as net income plus depreciation and amortization of real estate, less gains from sales of assets and securities, less distribution requirements with respect to preferred shares of the Trust. FFO is presented because industry analysts and the Trust consider FFO to be an appropriate supplemental measure of performance of REITs. FFO is not a substitute for cash funds generated from operating activities or net income as determined in accordance with generally accepted accounting principles, as a measure of profitability or liquidity. FFO as defined by the Trust may not be comparable to the definition used by other REITs. 23 26 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (a) Liquidity and Capital Resources As of July 31, 1998, the Trust had approximately $26.3 million in available cash and cash equivalents, $1.8 million in marketable securities and $13.9 million in mortgages receivable. During fiscal 1998, the Trust paid approximately $105 million in cash and assumed mortgage debt of $51.9 million to acquire 14 shopping centers containing an aggregate of approximately 1.9 million square feet of GLA and five apartment communities containing approximately 1,600 units. In addition, approximately $18 million was paid for improvements to existing properties. Debt as of July 31, 1998 consisted of $114.1 million of mortgages payable having a weighted average interest rate of 7.8% and $462.8 million aggregate principal amount of unsecured notes having a weighted average interest rate of 6.9%. The $48.5 million increase in mortgages payable was the net result of the assumption of $51.9 million of mortgages payable in connection with the purchase of properties and the repayment of $3.4 million of existing mortgages. During fiscal 1998, the Trust sold $50 million aggregate principal amount of unsecured notes having an interest rate of 6.9% and maturing on February 15, 2028. The increase in other liabilities is due to increases in accounts payable, interest payable and real estate taxes payable. These increases are primarily the result of the larger portfolio of properties and an increased level of outstanding debt. Short-term debt consists of normal trade accounts payable and the current portion of mortgages payable. The Trust's dividend reinvestment program generated approximately $18.2 million during fiscal 1998. In addition, holders of Common Shares and preferred shares of the Trust received $93.1 million in dividend distributions. FFO applicable to Common Shares, defined as net income plus depreciation and amortization of real estate, less gains from sales of assets and securities, less distribution requirements with respect to preferred shares of the Trust, increased $14.8 million to $116.4 million from $101.6 million in the prior year. FFO is presented because industry analysts and the Trust consider FFO to be an appropriate supplemental measure of performance of REITs. FFO is not a substitute for cash funds generated from operating activities or net income as determined in accordance with generally accepted accounting principles, as a measure of profitability or liquidity. FFO as defined by the Trust may not be comparable to the definition used by other REITs. Other sources of funds are available to the Trust. Based on management's internal valuation of the Trust's properties, most of which are free and clear of mortgages, the estimated value is considerably in excess of the outstanding mortgage indebtedness totaling $114.1 million. Accordingly, management believes that potential exists for additional mortgage financing as well as unsecured borrowing capacity from public debt financing, banks and other lenders. The Trust holds debt instruments which are sensitive to changes in interest rates and marketable equity securities which are sensitive to market price changes. With respect to the Trust's debt instruments, the maturity, weighted average interest rates and fair value are presented in Notes E, F and P to the Consolidated Financial Statements. With respect to the Trust's marketable equity securities, the cost and fair value are presented in Note B to the Consolidated Financial Statements. In the normal course of business, the Trust also faces risks that are either non-financial or non-qualitative. Such risks principally include credit risks and legal risks and are not included in the 24 27 aforementioned notes. Between July 31, 1998 and September 30, 1998, the Trust purchased an apartment community containing 278 units in North Carolina, as well as a single tenant retail property containing approximately 34,000 square feet of GLA in Pennsylvania. The aggregate purchase price for these properties was approximately $14.2 million. On August 11, 1998, the Trustees declared a cash distribution to holders of record of the Common Shares as of September 1, 1998 in the amount of $.375 per share (approximately $22.5 million in the aggregate) payable on September 11, 1998. Also on August 11, 1998, the Trustees declared a cash distribution to holders of record of each 7.8% Series A Cumulative Step-Up Premium Rate Preferred Shares, par value $1.00 per share, of the Trust as of September 1, 1998 in the amount of $9.75 per share ($.975 per depositary share and approximately $1.5 million in the aggregate) payable on September 15, 1998. (b) Year 2000 Compliance Readiness The Trust's centralized corporate business and technical information systems have been assessed as to Year 2000 compliance and functionality. Presently these systems are nearly complete with respect to required software or hardware changes. See " -- Year 2000 Compliance Detail" below. The Trust anticipates that internal business and technical information Year 2000 compliance issues will be substantially remediated by the end of calendar 1998. The Trust has satisfactorily completed the identification and review of computer hardware and software suppliers and is in the process of verifying the Year 2000 preparedness of suppliers, vendors and/or service providers that the Trust has identified as critical. Cost The total historical and anticipated remaining costs for the Year 2000 remediation are estimated to be immaterial to the Trust's financial condition. The costs to date have been expensed as incurred and consist of immaterial internal staff costs and other expenses such as telephone and mailing costs. In addition, where the appropriate course of action includes replacement or upgrade of certain systems or equipment, the Trust's review at this time indicates a minor cost to the Trust. Risks and Contingency Plans Considering the substantial progress made to date, the Trust does not anticipate delays in finalizing internal Year 2000 remediation within remaining time schedules. However, third parties having a material relationship with the Trust (e.g., utilities, financial institutions, governmental agencies, municipalities and major tenants) may be a potential risk based on their individual Year 2000 preparedness which may not be within the Trust's reasonable control. The Trust is in the process of identifying, reviewing and logging the Year 2000 preparedness of critical third parties. Anticipated completion of this review is calendar 1998 year-end. Pending the results of that review, the Trust will determine what course of action and contingencies will need to be made. 25 28 There can be no assurance that the external Year 2000 issues will be resolved in 1998 or 1999. If not resolved, such issues could have a material adverse impact on the Trust's business, operating results and financial condition. Year 2000 Compliance Detail The Trust's "Program" addresses the Year 2000 issue with respect to the following: (i) the Trust's information technology and operating systems, including its billing, accounting and financial reporting systems; (ii) the Trust's non-information technology systems, including building access, parking lot light and energy management, equipment and other infrastructure systems that may contain or use computer systems or embedded microcontroller technology; and (iii) certain systems of the Trust's major suppliers and material service providers (insofar as such systems relate to the Trust's business activities such as payroll, health services and alarm systems). As described below, the Trust's Year 2000 program involves (w) an assessment of the Year 2000 problems that may affect the Trust, (x) the development of remedies to address the problems discovered in the assessment phase, (y) the testing of such remedies and (z) the preparation of contingency plans to deal with worst case scenarios. Assessment Phase. As part of the internal assessment phase, the Trust has attempted to substantially identify all the major components of the systems described above. In determining the extent to which such systems are vulnerable to the Year 2000 issue, the Trust is evaluating internally developed and/or purchased software applications and property operational control systems, e.g., heating ventilation and air conditioning (HVAC), lighting timers, alarms, fire, sewage and access. In addition, in the third quarter of 1998, the Trust began sending letters to certain of its major suppliers and service providers, requesting them to provide the Trust with assurance of existing or anticipated Year 2000 compliance by their systems insofar as the systems relate to their activities with the Trust. The Trust expects that it will complete its distribution of these inquiries early in the fourth quarter of 1998. The Trust is requesting that all responses to the inquiries be returned to it no later than December 25, 1998. Remediation and Testing Phase. Based upon the assessment and remediation efforts to date, the Trust has completed, tested and put on line the Year 2000 compliance modification in all the internally developed software for its accounting and property management applications. Approximately two-thirds of the Trust's computer terminals or personal computers are Year 2000 compliant. Those that are not compliant have been identified. The Trust has secured software to upgrade that part of the computer that will make it compliant. That part is called the BIOS chip or Basic Input Output System. If there is any unforeseen problem with a particular unit it will be replaced. Replacements are readily available. A conservative, "worst case" scenario is included in the cost estimate. The versions of the purchased software that the Trust uses for spread sheet analysis, database applications, word processing systems and its apartment rent collection system have been tested and are compliant. The outsourced payroll service and the integrated internal input system are compliant. Home office phone, communication and data collection networks are Year 2000 compliant. Home office voice mail and access systems are scheduled for upgrade to Year 2000 compliant by December 25, 1998. Phone systems at other than the home office location are 72.5% Year 2000 compliant. The balance of the phone locations are scheduled to be reviewed and be Year 2000 compliant in 1998 or upgraded in the first quarter of 1999. The cost estimates derived from this assessment are treated as worst case. The Trust's shopping centers are all "open air" type and are simple and very limited in terms of technology. Field systems for shopping center HVAC, sprinkler and lighting are 95.8% reviewed 26 29 and Year 2000 compliant for those systems supplied by the Trust (some are supplied by tenants). The small number of systems not supplied by the Trust are being reviewed and are projected to not have a material impact. All of the 54 apartment communities have had reviews completed and are Year 2000 compliant. All of the six factory outlet centers have had reviews completed and, except for two minor items, are Year 2000 compliant. These two items are a telephone system modification at one property and a report due from an HVAC vendor at another property. Both are expected to be completed by December 31, 1998. Contingency Plans. The Trust intends to develop contingency plans to handle its most reasonably likely worst case Year 2000 scenarios. These have not yet been identified fully. The Trust intends to complete its determination of worst case scenarios after it has received and analyzed responses to substantially all of the inquiries it has made of third parties. Following its analysis, the Trust intends to develop a timetable for completing its contingency plans. Costs Related to the Year 2000 Issue. To date, the Trust has incurred no material costs. Labor, mailing and phone costs attributed to the Year 2000 program are minimal. The Trust currently estimates that to have all systems compliant will incur some additional costs. At this time they appear to range from $40,000 to a conservative, "worst case" of $250,000 in total. These costs may vary plus or minus 20% from the foregoing estimates. Risks Related to the Year 2000 Issue. Although the Trust's Year 2000 efforts are intended to minimize the adverse effects of the Year 2000 issue on the Trust's business and operations, the actual effects of the issue and the success or failure of the Trust's efforts described above cannot be known until the year 2000. Failure by the Trust's major suppliers, and other service providers to address adequately their respective Year 2000 issues in a timely manner (insofar as such issues relate to the Trust's business) could have a material adverse effect on the Trust's business, results of operations and financial condition. However, the Trust believes that such material effect is primarily limited to items of a utility nature furnished by third parties to the Trust and a wide universe of other customers. Included are items such as electricity, natural gas, telephone service and water, all of which are not readily susceptible to alternate sources and which in all likelihood will be available in some form. (c) The Merger Immediately following the consummation of the Merger on September 28, 1998, approximately 88 million shares of New Plan Excel Common Stock were outstanding. Immediately following the consummation of the Merger, former holders of the Trust's Common Shares held approximately 65% of the outstanding shares of New Plan Excel Common Stock. As provided in the Merger Agreement, effective September 28, 1998, the Board of Trustees of the Trust and the Board of Directors of New Plan Excel consist of the six former members of Excel's Board and the nine former members of the Trust's Board. The Merger Agreement provides that the initial quarterly dividend to be paid on the New Plan Excel Common Stock will be at the annualized rate of $1.60 per share ($.40 per share for the first quarter following the Merger) and, after anticipated minimum quarterly increases of at least $.0025 per share, each holder of New Plan Excel Common Stock is expected to received aggregate dividend distributions of 27 30 $1.625 per share for the 12-month period immediately following the initial quarterly dividend payment of $.40 per share. Thereafter, it is anticipated that the quarterly dividend will continue to be increased by a minimum of at least $.0025 per share (which quarterly increases amount to $.01 per share on an annualized basis and effectively increase the annualized dividend rate by $.04 per share for each share held over a 12-month period) until the annualized quarterly dividend on the New Plan Excel Common Stock is at least $1.67 per share. The maintenance of this dividend policy will be subject to various factors, including the discretion of the Board of Directors of New Plan Excel, the exercise by the Board of Directors of New Plan Excel of its duties to the holders of New Plan Excel Common Stock, the ability to pay dividends under applicable law and the effect which the payment of dividends may have from time to time on the maintenance by New Plan Excel of its status as a REIT. The Merger will, for financial accounting purposes, be accounted for as a purchase of Excel by the Trust using the purchase method of accounting. The transaction was completed on September 28, 1998. (d) New Accounting Standards During fiscal 1998, the Trust adopted the provisions of SFAS 128 and SFAS 129. SFAS 129 had no impact on the financial statements. Pursuant to SFAS 128, the Trust restated all per share data to conform with the provisions of that pronouncement (See Note I). During fiscal 1998, the Financial Accounting Standards Board issued (i) No. 130 "Reporting Comprehensive Income" ("SFAS 130"), which is effective for fiscal years beginning after December 15, 1997, (ii) No. 131 "Disclosures About Segments of an Enterprise and Related Information" ("SFAS 131"), which is effective for fiscal years beginning after December 15, 1997, (iii) No 132 "Employees Disclosure About Pensions and Other Postretirement Benefits" ("SFAS 132"), which is effective for fiscal years beginning after December 15, 1997, and (iv) No. 133 "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), which is effective for fiscal years beginning after June 15, 1999. Management believes that the implementation of SFAS 130, 131, 132 and 133 will not have a material impact on the Trust's financial statements. In addition, during fiscal 1998, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities" ("SOP 98-5"), and Statement of Position 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use" ("SOP 98-1"), each of which is effective for fiscal years beginning after December 15, 1998. Also during fiscal 1998, the Emerging Issues Task Force of the Financial Accounting Standards Board released Issue No. 97-11, "Accounting for Internal Costs Relating to Real Estate Property Acquisitions" ("EITF 97-11"), and Issue No. 98-9, "Accounting for Contingent Rent in Interim Financial Periods" ("EITF 98-9"). SOP 98-5 requires that certain costs incurred in conjunction with start-up activities be expensed. SOP 98-1 provides guidance on whether the costs of computer software developed or obtained for internal use should be capitalized or expensed. EITF 97-11 requires that the internal pre-acquisition costs of identifying and acquiring operating property be expensed as incurred. EITF 98-9 requires that contingent revenue not be accrued until a future specified sales target is achieved. Management believes that, when adopted, SOP 98-5 and SOP 98-1 will not have a significant impact on the Trust's financial statements. EITF 97-11 and 98-9 were adopted during fiscal 1998 and did 28 31 not have a material impact on the Trust's financial statements. (e) Results of Operations Fiscal Year Ended July 31, 1998 Compared to Fiscal Year Ended July 31, 1997 In fiscal 1998, total revenues increased $43.5 million to $250.3 million. The increase was in rental income and related revenues and came from all categories of properties. Interest and dividend income decreased because of lower average investment balances. Operating expenses increased $29.3 million to $156.9 million. Operating costs, real estate and other taxes, and depreciation and amortization increased primarily because of property acquisitions. Interest expense increased $8.6 million to $36.8 million primarily due to a higher level of outstanding unsecured notes and mortgage debt during fiscal 1998. The increase in the provision for doubtful accounts reflects a larger revenue base and a higher level of receivables. Administrative expenses as a percentage of revenue remained constant at 1.1% of revenue compared to fiscal 1997. Net income applicable to Common Shares increased $8.1 million to $84.7 million and earnings per Common Share increased to $1.42 per share (on a fully diluted basis) from $1.30 per share (on a fully diluted basis). The increase is net of $5.9 million of distributions to holders of preferred shares of the Trust. FFO, defined as net income plus depreciation and amortization of real estate, less gains from sales of assets and securities, less distribution requirements with respect to preferred shares of the Trust, increased $20.2 million to $122.2 million. FFO is presented because industry analysts and the Trust consider FFO to be an appropriate supplemental measure of performance of REITs. FFO is not a substitute for cash funds generated from operating activities or net income as determined in accordance with generally accepted accounting principles, as a measure of profitability or liquidity. FFO as defined by the Trust may not be comparable to the definition used by other REITs. During fiscal 1998, distributions declared and paid were $1.475 per Common Share, a $.04 per share increase over fiscal 1997. The most recent distribution declaration for Common Shares was $.3725 per share ($1.49 on an annualized basis). Fiscal Year Ended July 31, 1997 Compared to Fiscal Year Ended July 31, 1996 In fiscal 1997, total revenues increased $39.2 million to $206.8 million. The increase was in rental income and related revenues and came from properties in the portfolio which were acquired in fiscal 1997 or were owned for less than a full year in fiscal 1996. Interest and dividend income decreased slightly. Operating expenses increased $32.7 million to $127.6 million. Operating costs, real estate and other taxes, and depreciation and amortization increased primarily because of property acquisitions. Interest expense increased $10.7 million to $28.3 million due to a higher level of outstanding debt during fiscal 1997. The increase in the provision for doubtful accounts reflects a larger revenue base and a higher level of receivables. Administrative expenses as a percentage of revenue declined to 1.1% from 1.6% due to increased revenue from newly acquired properties; these costs do not increase in direct proportion to revenue due to economies of scale. Income before (loss)/gain on sale of properties and securities increased $6.9 million to $77 million. During fiscal 1997, three former Nichols stores, in Annville and Hanover, Pennsylvania and 29 32 Lumberton, North Carolina, were sold. Net income applicable to Common Shares increased $6.1 million to $77 million and earnings per Common Share increased to $1.31 per share from $1.25 per share. FFO, defined as net income plus depreciation and amortization of real estate, less gains from sales of assets and securities, less distribution requirements with respect to preferred shares of the Trust, increased $11.9 million to $102 million. FFO is presented because industry analysts and the Trust consider FFO to be an appropriate supplemental measure of performance of REITs. FFO is not a substitute for cash funds generated from operating activities or net income as determined in accordance with generally accepted accounting principles, as a measure of profitability or liquidity. FFO as defined by the Trust may not be comparable to the definition used by others REITs. During fiscal 1997, distributions declared and paid were $1.435 per Common Share, a $.04 per share increase over fiscal 1996. The most recent distribution declaration for Common Shares was $.365 per share which is $1.46 per share on an annualized basis. Fiscal Year Ended July 31, 1996 Compared to Fiscal Year Ended July 31, 1995 In fiscal 1996, total revenues increased $37 million to $167.6 million. Rental income and related revenues increased $36.4 million to $162.8 million. The increase in rental revenue came primarily from properties in the portfolio which were acquired in fiscal 1996 or were owned for less than a full year in fiscal 1995. In addition, increased revenue from all property categories, apartments, factory outlets and shopping centers, owned prior to fiscal 1995 contributed to the rental revenue increase. Interest and dividend income increased $.7 million due to higher average investment balances. Operating expenses increased $29.3 million to $94.9 million. Operating costs, real estate and other taxes, and depreciation and amortization increased primarily because of property acquisitions. Interest expense increased $10.4 million to $17.6 million due to a higher level of outstanding debt during fiscal 1996. The increase in the provision for doubtful accounts reflects a much larger revenue base and a higher level of receivables. Administrative expenses as a percentage of revenue declined to 1.6% from 1.9% due to increased revenue from newly acquired properties; these costs do not increase in direct proportion to revenue due to economies of scale. Income before gain/(loss) on the sale of properties and securities increased $7.6 million to $70.1 million. During fiscal 1996, a shopping center in Chinoe, Kentucky and two former Nichols stores in Harrisonburg, Virginia and New Bern, North Carolina were sold for a net gain of $.5 million. The $.1 million loss on the sale of securities was due to bonds being called which had been issued at a premium. Net income applicable to Common Shares increased $7.8 million to $70.5 million and earnings per Common Share increased to $1.25 per share from $1.19 per share. FFO, defined as net income plus depreciation and amortization of real estate less net gains from the sale of assets, increased $12.6 million to $90.1 million. FFO is presented because industry analysts and the Trust consider FFO to be an appropriate supplemental measure of performance of REITs. FFO is not a substitute for cash funds generated from operating activities or net income as determined in accordance with generally accepted accounting principles, as a measure of profitability or liquidity. FFO as defined by the Trust may not be comparable to the definition used by others REITs. 30 33 During fiscal 1996, distributions declared and paid were $1.395 per share of beneficial interest, a $.04 per share of beneficial interest increase over the preceding year. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK As of July 31, 1998, the Trust had approximately $99 million of floating rate debt outstanding. The Trust does not believe that the interest rate risk represented by its floating rate debt is material as of that date in relation to the approximately $575 million of total debt outstanding of the Trust and the approximately $1.37 billion market capitalization of the Common Shares. The Trust was not a party to any hedging agreements with respect to its floating rate debt as of July 31, 1998. In the event of a significant increase in interest rates, the Trust would consider entering into hedging agreements with respect to all or a portion of its floating rate debt. Although hedging agreements would enable the Trust to convert floating rate liabilities to fixed rate liabilities, they would expose the Trust to the risk that the counterparties to such hedge agreements may not perform, which could increase the Trust's exposure to rising interest rates. Generally, however, the counterparties to hedging agreements that the Trust would enter into would be major financial institutions. The Trust may borrow additional money with floating interest rates in the future. Increases in interest rates, or the loss of the benefits of any hedging agreements that the Trust may enter into in the future, would increase the Trust's interest expenses, which would adversely affect cash flow and the ability of the Trust to service its debt. If the Trust enters into any hedging agreements in the future, decreases in interest rates thereafter would increase the Trust's interest expenses as compared to the underlying floating rate debt and could result in the Trust making payments to unwind such agreements. As of July 31, 1998, the Trust had no other material exposure to market risk (i.e., foreign currency exchange risk, commodity price risk or equity price risk). ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The response to this item is included in Pages F-1 to F-42 attached to this report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. PART III ITEM 10. TRUSTEES AND EXECUTIVE OFFICERS OF THE TRUST As of July 31, 1998, the Board of Trustees consisted of nine trustees. In connection with the consummation of the Merger on September 28, 1998, the Board of Trustees was expanded to consist of 15 trustees. See "Business -- Narrative Description of Business -- Consummation of the Merger." The trustees are divided into three classes which consist of five trustees whose terms expire at the 1999 annual meeting of shareholders (Messrs. Bernstein, Bottorf, Lindquist, Parsons and White), five trustees whose terms expire at the 2000 annual meeting of shareholders (Messrs. Sabin, Steuterman, Staller, Melvin Newman and Wetzler) and five trustees whose terms expire at the 2001 annual meeting of shareholders (Messrs. William Newman, Laubich, Muir, Gold and Wilmot). At each of the 31 34 respective annual meetings, five trustees will be elected, each to hold office for a specified term and until his successor is elected and qualified. Biographical Information of the Trustees William Newman, age 72, has been Chairman of the Board of Trustees of the Trust since its organization in 1972 and Chairman of the Board of Directors of New Plan Excel since September 1998. He served as Chief Executive Officer of the Trust from 1972 to September 1998 and as President of the Trust from 1972 to 1988. He served as President and Chief Executive Officer of the Trust's predecessor corporation, New Plan Realty Corporation, from the corporation's organization in 1961 through its reorganization into the Trust in 1972. He is a past Chairman of the National Association of Real Estate Investment Trusts. Mr. Newman is a Certified Public Accountant, and has been actively involved in real estate for over 50 years. Arnold Laubich, age 68, has been a trustee of the Trust since 1988 and a director of New Plan Excel since September 1998. He has been Chief Executive Officer of the Trust and New Plan Excel since September 1998. He was President and Chief Operating Officer of the Trust from 1988 to September 1998. From 1972 to 1988, Mr. Laubich was President of Dover Management Corporation, which, during that period, managed the Trust's properties. From 1961 to 1972, he served as Executive Vice President of the Trust's predecessor corporation. Gary B. Sabin, age 44, has been a trustee of the Trust since September 1998 and a director of Excel (now New Plan Excel) since 1989. He has served as President of the Trust since September 1998 and of Excel (now New Plan Excel) since 1989. He has served as Chairman of Investment Committee of the Trust and New Plan Excel since September 1998. He served as Chairman of the Board of Directors and Chief Executive Officer of Excel (now New Plan Excel) from 1989 to September 1998. Mr. Sabin has served as Chairman of the Board, President and Chief Executive Officer of Excel Legacy Corporation since April 1998. In addition, Mr. Sabin has served as Chief Executive Officer of various companies since his founding of Excel's predecessor corporation and its affiliates starting in 1977. He has been active in diverse aspects of the financial services industry, including the evaluation and negotiation of real estate acquisitions, management, financing and disposition. James M. Steuterman, age 42, has been a trustee of the Trust since 1990 and a director of New Plan Excel since September 1998. He has served as Co-Chief Operating Officer of the Trust and New Plan Excel since September 1998. He has also served as Executive Vice President of the Trust since 1994 and of New Plan Excel since September 1998. Mr. Steuterman has been associated with the Trust since 1984 as a property acquisition specialist, becoming Director of Acquisitions in 1986, a Vice President in 1988 and a Senior Vice President in 1989. Richard B. Muir, age 43, has served as trustee of the Trust since September 1998 and a director of Excel (now New Plan Excel) since 1989. He has served as Co-Chief Operating Officer of the Trust and New Plan Excel since September 1998. He has also served as Executive Vice President of the Trust since September 1998 and of Excel (now New Plan Excel) since 1989. He served as Secretary of Excel from 1989 to September 1998. Mr. Muir has served as director, Executive Vice President and Secretary of Excel Legacy Corporation since April 1998. Mr. Muir has served as an officer and director for various affiliates of Excel since 1978, primarily in administrative and executive capacities, including asset acquisition, financing and management. Dean Bernstein, age 40, has been a trustee of the Trust since 1992 and a director of New Plan Excel since September 1998. He has been Senior Vice-President -- Finance and Multifamily of the 32 35 Trust and New Plan Excel since September 1998. He served as Vice President -- Administration and Finance of the Trust from 1994 to September 1998. He served as Assistant Vice President of the Trust from 1991 to 1994. From 1988 to 1991, Mr. Bernstein was a Vice President in the Real Estate Group at Chemical Bank. Mr. Bernstein is the son-in-law of William Newman. Raymond H. Bottorf, age 56, has been a trustee of the Trust since 1991 and a director of New Plan Excel since September 1998. Mr. Bottorf has been the Managing Director of the New York office of the Global Property Team of ABN-AMRO Chicago Corp., an investment bank, since 1997. From 1990 to 1997, he was the President and sole director of U.S. Alpha, Inc., New York, New York, a wholly owned subsidiary of Stichting Pensioenfonds (formerly Algemeen Burgerlijk Pensioenfonds). Norman Gold, age 68, has been a trustee of the Trust since its organization in 1972 and a director of New Plan Excel since September 1998. He has been active in the practice of law for 44 years and a partner of the law firm of Altheimer & Gray for over 35 years. He is also a trustee of Banyan Strategic Realty Trust, which is not in any way related to or competitive with either the Trust or New Plan Excel. Boyd A. Lindquist, age 61, has served as a trustee of the Trust since September 1998 and a director of Excel (now New Plan Excel) since 1992. Mr. Lindquist is presently President, Chief Executive Officer and a director of Republic Bank. Prior to joining Republic Bank in July 1991, Mr. Lindquist served since prior to 1987 as President and Chief Executive Officer of the Bank of San Diego, where he was responsible for the management of the six-branch bank. Mr. Lindquist has over 30 years' experience in managing financial institutions. Melvin Newman, age 56, has been a trustee of the Trust since 1983 and a director of New Plan Excel since September 1998. From 1972 to 1982, he was Vice President and General Counsel of the Trust. Mr. Newman is a private investor. Mr. Newman is the brother of William Newman. Robert E. Parsons, Jr., age 42, has served as a trustee of the Trust since September 1998 and a director of Excel (now New Plan Excel) since 1989. He has served as a director of Excel Legacy Corporation since April 1998. Mr. Parsons is presently Executive Vice President and Chief Financial Officer of Host Marriott corporation, a company he joined in 1981. He also serves as a director and an officer of several Host Marriott subsidiaries, and as a director of Merrill Lynch Financial Corporation, a privately held real estate company. Bruce A. Staller, age 61, has served as a trustee of the Trust since September 1998 and a director of Excel (now New Plan Excel) since 1989. Mr. Staller served as a director of Excel's predecessor corporation from 1987 to 1989. Prior to establishing Bruce Atwater Staller, Registered Investment Advisor in 1995, Mr. Staller served from 1988 to 1995 as President and director of First Wilshire Securities Management, Inc., a privately held investment advisor. Mr. Staller is also a founder and director of the Monrovia Schools Foundation, Inc., a private tax-exempt educational foundation which provides financial support to the Monrovia Unified School District. John Wetzler, age 52, has been a trustee of the Trust since 1994 and a director of New Plan Excel since September 1998. Mr. Wetzler has been President of Nautica Retail U.S.A., Inc., a subsidiary of Nautica Enterprises, Inc., the international men's apparel maker and marketer, since July 1994. From December 1988 to June 1994, he was the Executive Vice President of Nautica Retail U.S.A., Inc. Gregory White, age 42, has been a trustee of the Trust since 1994 and a director of New Plan Excel since September 1998. Mr. White has served as Senior Vice President of Conning Asset 33 36 Management Company, an investment advisory firm, since August 1998. From 1992 to August 1998, Mr. White was a founding partner and Managing Director of Schroder Mortgage Associates in New York, New York. From 1988 to 1992, he was a Managing Director of the Salomon Brothers Inc. real estate finance department. John A. Wilmot, age 56, has served as a trustee of the Trust since September 1998 and a director of Excel (now New Plan Excel) since 1989. He has served as a director of Excel Legacy Corporation since April 1998. Mr. Wilmot, individually and through his wholly owned corporations, develops and manages real property, primarily in the Phoenix/Scottsdale area, and has been active in such business since prior to 1989. Board of Trustees Meetings During the Trust's fiscal year ended July 31, 1998, the Board of Trustees held four quarterly meetings, four special meetings and acted by unanimous written consent on 11 occasions. Board of Trustees Committees As of July 31, 1998, the Board of Trustees had an Audit Committee. As of that date, the Audit Committee was composed of Messrs. Gold, White, Wetzler and Bottorf. The Audit Committee recommended to the Board of Trustees the selection of the independent auditors to be employed by the Trust and reviewed generally the Trust's internal and external audits and the results thereof. The Audit Committee held two meetings during fiscal 1998. In connection with the consummation of the Merger, since September 28, 1998, the Trust has not had an Audit Committee. The Board of Trustees does not have a nominating committee or a compensation committee, nor does it have a committee performing the functions of a nominating committee or a compensation committee; the Trustees perform the functions of those committees. However, as of July 31, 1998, the Board of Trustees had a Special Compensation Committee, which consisted of four of the Trust's non-employee Trustees (Messrs. Bottorf, Gold, Wetzler and White). The Special Compensation Committee reviewed the compensation arrangements of Messrs. William Newman, Laubich, Steuterman and Bernstein, the Trustees who also were, as of that date, executive officers of the Trust. In connection with the consummation of the Merger, since September 28, 1998, the Trust has not had a Special Compensation Committee. The Board of Trustees has four Stock Option Committees. As of July 31, 1998, the Trust had three Stock Option Committees to administer the Trust's 1997 Stock Option Plan: (i) a committee consisting of Messrs. Bottorf, Gold, Wetzler and White, which administered the plan with respect to the trustees who also were, as of that date, executive officers of the Trust and, subject to the provisions of such plan, determined the terms of the options granted to such executive officers; (ii) a committee consisting of the entire Board of Trustees as of that date which administered the Plan with respect to certain designated senior officers of the Trust and, subject to the provisions of such plan, determined the terms of the options granted to such officers; and (iii) a committee consisting of Messrs. William Newman and Laubich which administered the Plan with respect to all other employees of the Trust and, subject to the provisions of such plan, selected the employees to participate in the plan and determined the terms of the options granted to participating employees. The first two Stock Option Committees discussed above acted by unanimous written consent on one occasion during the last fiscal year and the last Stock Option Committee discussed above acted by unanimous written consent on two occasions during the last fiscal year. 34 37 As of July 31, 1998, the Trust also had a Stock Option Committee consisting of Messrs. Newman, Gold and Laubich which administered the 1991 Stock Option Plan, the Amended and Restated 1985 Incentive Stock Option Plan and the Non-Qualified Stock Option Plan of the Trust. This committee, subject to the provisions of the 1991 Stock Option Plan, selected the Trustees, officers and employees who were to participate in that plan and determined the terms of their options. This committee acted with respect to the 1991 Stock Option Plan by unanimous written consent on three occasions during the last fiscal year. This committee did not act during the last fiscal year with respect to the Amended and Restated 1985 Incentive Stock Option Plan or the Non-Qualified Stock Option Plan. In connection with the consummation of the Merger, as of September 28, 1998, all outstanding options under the stock option plans of the Trust identified above, whether or not then exercisable, were assumed by New Plan Excel and now represent an option to purchase the same number of shares of New Plan Excel Common Stock, at an exercise price per share equal to the per share exercise price of the Common Shares subject to such options immediately prior to the consummation of the Merger. Each such assumed option is exercisable upon the same terms and conditions as were applicable to the related options under the stock option plans of the Trust. Each of the Stock Option Committees described above continues to administer the plans described above. Trustees' Compensation As of July 31, 1998, the trustees of the Trust who were not employees of the Trust each received $12,500 in annual trustee fees and $500 per meeting. In addition, the Trust reimbursed the trustees for travel expenses incurred in connection with their activities on behalf of the Trust. In connection with the consummation of the Merger, since September 28, 1998, the trustees of the Trust no longer receive any trustee or meeting fees, although they continue to receive expense reimbursements. 35 38 EXECUTIVE OFFICERS OF THE TRUST As of July 31, 1998, the executive officers of the Trust and their principal occupations as of such date were as follows:
Name & Principal Position Age ------------------------- --- William Newman.............................. 72 Chairman of the Board of Trustees and Chief Executive Officer of the Chairman of the Board of Trustees Trust since its organization in 1972; President of the Trust from 1972 and Chief Executive Officer to 1988; President and Chief Executive Officer of the Trust's predecessor corporation from 1961 to 1972; a past Chairman of the National Association of Real Estate Investment Trusts; Certified Public Accountant and active in real estate for over 50 years. Arnold Laubich.............................. 68 President, Chief Operating Officer and trustee of the Trust since 1988; President, Chief Operating Officer President of Dover Management Corp. (which had managed the Trust's and Trustee properties) from 1972 to 1988; Executive Vice President of the Trust's predecessor corporation from 1961 to 1972. James M. Steuterman......................... 42 Executive Vice President of the Trust since 1994; trustee of the Trust Executive Vice President since 1990; Senior Vice President of the Trust from 1989 to 1994; Vice and Trustee President of the Trust from 1988 to 1989. Dean Bernstein.............................. 40 Vice President--Administration and Finance of the Trust since 1994; Vice President--Administration and trustee of the Trust since 1992; Assistant Vice President of the Trust Finance and Trustee from 1991 to 1994; previously a Vice President in the Real Estate Group at Chemical Bank. William Kirshenbaum......................... 62 Vice President of the Trust since 1981; Treasurer of the Trust since Vice President and Treasurer 1983. Michael I. Brown............................ 56 Chief Financial Officer of the Trust since 1991; Controller of the Chief Financial Officer and Trust since 1987. Controller Steven F. Siegel............................ 38 General Counsel and Secretary of the Trust since 1991. General Counsel and Secretary James DeCicco............................... 52 Senior Vice President--Leasing of the Trust since 1996; Vice President Senior Vice President--Leasing of the Trust since 1992; employee of the Trust since 1991. Thomas J. Farrell........................... 41 Vice President--Acquisitions and employee of the Trust since 1994; Vice President--Acquisitions previously a Vice President at The Balcor Company, a real estate company. 36
39 In connection with the consummation of the Merger, since September 28, 1998, the executive officers of the Trust and their principal occupations have been as follows:
Name & Principal Position Age William Newman.............................. 72 Chairman of the Board of Trustees of the Trust since its organization in Chairman of the Board of Trustees 1972 and Chairman of the Board of Directors of New Plan Excel since September 1998; Chief Executive Officer of the Trust from 1972 to September 1998 and President of the Trust from 1972 to 1988; President and Chief Executive Officer of the Trust's predecessor corporation from 1961 to 1972; a past Chairman of the National Association of Real Estate Investment Trusts; Certified Public Accountant and actively involved in real estate for over 50 years. Arnold Laubich.............................. 68 Chief Executive Officer of the Trust and New Plan Excel since September Chief Executive Officer and Trustee 1998; trustee of the Trust since 1988 and director of New Plan Excel since September 1998; President and Chief Operating Officer of the Trust from 1988 to September 1998; President of Dover Management Corp. (which previously managed the Trust's properties) from 1972 to 1988; Executive Vice President of the Trust's predecessor corporation from 1961 to 1972. Gary B. Sabin............................... 44 President of the Trust since September 1998 and of Excel (now New Plan President and Chairman of Investment Excel) since 1989; Chairman of Investment Committee of the Trust and New Committee Plan Excel since September 1998; trustee of the Trust since September 1998 and director of Excel (now New Plan Excel) since 1989; Chairman of the Board of Directors and Chief Executive Officer of Excel from 1989 to September 1998; Chairman of the Board, President and Chief Executive Officer of Excel Legacy Corporation since April 1998; Chief Executive Officer of various companies since his founding of Excel's predecessor corporation and its affiliates starting in 1977. James M. Steuterman......................... 42 Co-Chief Operating Officer of the Trust and New Plan Excel since Executive Vice President, Co-Chief September 1998; Executive Vice President of the Trust since 1994 and of Operating Officer and Trustee New Plan Excel since September 1998; trustee of the Trust since 1990 and director of New Plan Excel since September 1998; Senior Vice President of the Trust from 1989 to 1994 and Vice President of the Trust from 1988 to 1989. Richard B. Muir............................. 43 Co-Chief Operating Officer of the Trust and New Plan Excel since Executive Vice President, Co-Chief September 1998; Executive Vice President of the Trust since September Operating Officer and Trustee 1998 and of Excel (now New Plan Excel) since 1989; trustee of the Trust since September 1998 and director of Excel (now New Plan Excel) since 1989; Secretary of Excel from 1989 to September 1998; director, Executive Vice President and Secretary of Excel Legacy Corporation since April 1998. David A. Lund............................... 46 Chief Financial Officer of the Trust since September 1998 and of Excel Chief Financial Officer (now New Plan Excel) since 1994; Vice President of Excel (now New Plan Excel) from 1988 to September 1998; Chief Financial Officer of Excel Legacy Corporation since April 1998; officer and director of certain affiliates of Excel (now New Plan Excel) since 1993; Certified Public Accountant. William Kirshenbaum......................... 62 Treasurer of the Trust since 1983 and of New Plan Excel since September Treasurer 1998; Vice President of the Trust from 1981 to September 1998. Dean Bernstein.............................. 40 Senior Vice President--Finance and Multifamily of the Trust and New Plan Senior Vice President--Finance and Excel since September 1998; trustee of the Trust since 1992 and director Multifamily and Trustee of New Plan Excel since September 1998; Vice 37
40 President-- Administration and Finance of the Trust from 1994 to September 1998; Assistant Vice President of the Trust from 1991 to 1994; previously a Vice President in the Real Estate Group at Chemical Bank. Graham R. Bullick........................... 48 Senior Vice President--Capital Markets of the Trust since September 1998 Senior Vice President--Capital Markets and Excel (now New Plan Excel) since 1991; director of Excel from 1991 to 1992; Senior Vice President--Capital Markets of Excel Legacy Corporation since April 1998; Vice President and Chief Operations Officer for an Arizona-based real estate investment firm from 1985 to 1991. Mark T. Burton.............................. 38 Senior Vice President--Acquisitions of the Trust since September 1998 Senior Vice President--Acquisitions and of Excel (now New Plan Excel) since 1995; Vice President of Excel from 1989 to 1995; Senior Vice President--Acquisitions of Excel Legacy Corporation since April 1998; associated with Excel (now New Plan Excel), its predecessor and its affiliates since 1983. James DeCicco............................... 52 Senior Vice President--Leasing of the Trust since 1996 and of New Plan Senior Vice President--Leasing Excel since September 1998; Vice President of the Trust from 1992 to 1996; employee of the Trust since 1991. Thomas J. Farrell........................... 41 Senior Vice President--Acquisitions of the Trust and of New Plan Excel Senior Vice President--Acquisitions since September 1998; Vice President--Acquisitions of the Trust from 1994 to September 1998; previously a Vice President at The Balcor Company, a real estate company. S. Eric Ottesen............................. 43 Senior Vice President--Legal Affairs and Secretary of the Trust and New Senior Vice President--Legal Affairs Plan Excel since September 1998; General Counsel of Excel from 1995 to and Secretary September 1998; Senior Vice President of Excel (now New Plan Excel) from 1995 to September 1998; Assistant Secretary of Excel from 1996 to September 1998; Senior Vice President, General Counsel and Assistant Secretary of Excel Legacy Corporation since April 1998; senior partner at a San Diego law firm from 1987 to 1995. Ronald H. Sabin............................. 48 Senior Vice President--Asset Management of the Trust since September Senior Vice President--Asset 1998 and of Excel (now New Plan Excel) since 1989; Senior Vice Management President--Asset Management of Excel Legacy Corporation since April 1998; officer or otherwise employed by affiliates of Excel since 1979. Steven F. Siegel............................ 38 General Counsel of the Trust since 1991 and of New Plan Excel since Senior Vice President and General September 1998; Senior Vice President of the Trust and New Plan Excel Counsel since September 1998; Secretary of the Trust from 1991 to September 1998. John Visconsi............................... 54 Vice President--Leasing of the Trust since September 1998 and of Excel Vice President--Leasing (now New Plan Excel) since 1997; Senior Vice President--Land Development of Price Enterprises, Inc. (a price club development group) from 1996 to 1997; Director of Leasing and Land Development for The Hahn Co., a real estate developer, from 1981 to 1996. 38
41 ITEM 11. EXECUTIVE COMPENSATION (a) Compensation The following table sets forth certain information for the fiscal years ended July 31, 1998, 1997 and 1996 with respect to the cash compensation and all other compensation paid by the Trust, as well as stock options granted by the Trust, to Mr. William Newman, the Trust's Chief Executive Officer during such years, and the Trust's four most highly compensated executive officers other than the Chief Executive Officer (collectively, the "Named Officers") during such years:
Long-Term Annual Compensation Compensation All Other Name & Principal Position Year Salary Bonus Options Compensation(1) ------------------------- ---- ------ ----- ------------- --------------- William Newman, CEO........................ 1998 $517,115 $125,000 112,500 $4,800 1997 $500,000 $125,000 37,500 $4,500 1996 $430,756 $ 75,000 ___ $25,337 Arnold Laubich, President.................. 1998 $517,115 $250,000 112,500 $4,800 1997 $500,000 $250,000 37,500 $4,500 1996 $444,085 $100,000 ___ $4,500 James M. Steuterman, Executive Vice President ............................ 1998 $319,268 $60,000 152,000 $4,800 1997 $290,000 $50,000 52,000 $4,500 1996 $232,693 $85,000 2,000 $4,500 Steven F. Siegel, General Counsel and Secretary.................................. 1998 $170,390 $22,500 112,500 $4,800 1997 $153,898 $19,000 37,500 $4,500 1996 $142,500 $48,500 5,000 $4,500 Thomas Farrell, Vice President-- Acquisitions .............................. 1998 $164,808 $30,000 112,500 $4,800 1997 $137,423 $25,000 47,500 $4,500 1996 $101,792 $20,000 12,500 $4,500
(1) Includes the 401(k) plan contribution for officers and the amount by which premiums exceeded the increase in cash surrender value for split dollar life insurance for the CEO. The annual premiums paid are $150,000. Excludes certain other personal benefits, the total value of which was less than the lesser of $50,000 or ten percent of the total salary and bonus paid or accrued by the Trust for services rendered by each officer during the fiscal year indicated. 39 42 (b) Option Grants in Last Fiscal Year The following table sets forth certain information with respect to options granted to the Named Officers during the fiscal year ended July 31, 1998:
Potential Realizable Value at Assumed Rates of Stock Price % of Total Appreciation for Option Term Options Granted Exercise --------------------------- Options to Employees in Price Per Expiration Name & Principal Position Granted Fiscal Year Share Date 5% (1) 10%(1) ------------------------- ------- --------------- --------- ---------- ---------- ---------- William Newman, CEO................. 112,500 7.8% $24.125 11/24/04 $1,104,896 $2,574,878 Arnold Laubich, President........... 112,500 7.8% $24.125 11/24/04 $1,104,896 $2,574,878 James M. Steuterman, Executive Vice President........................ 150,000 10.3% $24.125 11/24/04 $1,473,195 $3,433,170 2,000 0.1% $22.9375 07/31/04 $18,676 $43,522 Steven F. Siegel, General Counsel and Secretary.................... 112,500 7.8% $24.125 11/24/04 $1,104,896 $2,574,878 Thomas Farrell, Vice President--Acquisitions.......... 112,500 7.8% $24.125 11/24/04 $1,104,896 $2,574,878
- ---------------- (1) The 5% and 10% rates of appreciation were set by the Securities and Exchange Commission and are not intended to forecast future appreciation, if any, of the Trust's Common Shares. (c) Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option Values The following table sets forth certain information with respect to the option exercises during the fiscal year ended July 31, 1998, and the unexercised options held as of the end of such fiscal year, by the Named Officers: 40 43
Value of Unexercised in-the-Money Shares Number of Unexercised Options at Options at Fiscal Year- Acquired Fiscal Year-End End (1) on Value -------------------------------- --------------------------------- Name & Title Exercise Realized Exercisable Unexercisable Exercisable Unexercisable ------------ -------- -------- ----------- ------------- ----------- ------------- William Newman, CEO................. __ __ 523,750 276,250 $2,051,016 $543,516 Arnold Laubich, President........... __ __ 523,750 276,250 $2,051,016 $543,516 James M. Steuterman, Executive Vice President........................ __ __ 40,900 206,600 $ 23,119 $ 51,539 Steven F. Siegel, General Counsel and Secretary.................... __ __ 39,350 151,650 $ 39,692 $ 45,029 Thomas Farrell, Vice President-- Acquisitions..................... __ __ 13,250 159,250 $ 20,485 $ 49,204
- ---------- (1) Based upon a closing price per share of $22.8125 on July 31, 1998. (d) Trustees' Report on Executive Compensation The Board of Trustees does not have a compensation committee; thus, it is the duty of the entire Board of Trustees to review compensation plans, programs and policies and to monitor the performance and compensation of executive officers, including the Named Officers, and other key employees. The Board of Trustees does, however, have a Special Compensation Committee, consisting of four of the Trust's non-employee Trustees (Messrs. Bottorf, Gold, Wetzler and White). The Special Compensation Committee reviews the compensation arrangements of Messrs. William Newman, Laubich, Steuterman and Bernstein, the trustees who also were, as of September 25, 1998, executive officers of the Trust. Through September 25, 1998, the Board of Trustees has implemented compensation policies, plans and programs through which it sought to enhance the profitability of the Trust, and thus shareholder value, by aligning closely the financial interests of the Trust's senior managers with those of its shareholders. The Trust's overall objectives were to attract and retain the best possible executive talent, to motivate these executives to achieve the goals inherent in the Trust's business strategy, to link executive and shareholder interests through performance goals and equity based plans, and finally to provide a compensation package that recognizes individual contributions as well as overall business results. In furtherance of these goals, the Board of Trustees historically has compared the Trust to a selected group of REITs that compete in the Trust's shopping center and apartment community business, which the Board of Trustees believed represented the Trust's most direct competitors for executive talent. There were six REITs in that comparison group. Based on the relative size of the Trust in comparison with the peer group, the Board of Trustees positioned executive base salaries at competitive levels relative to the base salaries paid to executive officers of the peer group. The Trust also historically relied on Common Share options as incentive compensation. The Board of Trustees historically conducted a full review of the Trust's compensation program each year. This review included a comparison of the Trust's executive 41 44 compensation, business performance, Common Share appreciation and total return to shareholders to the peer group. The Board of Trustees also reviewed, on an annual basis, a selection of peer REITs used for compensation analysis, because the Board of Trustees believed that the Trust's most direct competitors for executive talent were not necessarily all of the companies that would be included in a peer group established for comparing shareholder returns. The Special Compensation Committee performed the same function and analysis with respect to Messrs. William Newman, Laubich, Steuterman and Bernstein. The key components of the Trust's executive compensation consisted of base salary, annual bonus and Common Share options. The Board of Trustees' historical policies with respect to each of these components are discussed below. In determining compensation, the Board of Trustees historically took into account the individual's full compensation package, including insurance and other benefits, as well as the components described below. The Special Compensation Committee performed the same function and analysis with respect to Messrs. William Newman, Laubich, Steuterman and Bernstein. It should be noted that the Trust currently has a 401(k) retirement plan covering substantially all officers and employees of the Trust. The 401(k) plan permits participants to defer up to a maximum of 10% of their compensation, and the Trust may, at the discretion of the Board of Trustees, make a voluntary contribution to the plan participants. For the last 401(k) plan year (1997), the contribution by the Trust was equal to 3% of each employee's eligible compensation. For the fiscal year ended July 31, 1998, the Trust's contribution to the 401(k) retirement plan allocated to the Chief Executive Officer was $4,800. Base Salaries Base salaries for executive officers historically were determined by evaluating the responsibilities of the position held and the experience of the individual, and by reference to the competitive marketplace for executive talent, including a comparison to base salaries for comparable positions in the peer group. The base salaries were intended to be fixed at competitive levels relative to the base salaries paid to executive officers with comparable qualifications, experience and responsibilities at other REITs in the comparison peer group. Annual salary adjustments were determined by evaluating the performance of the Trust and of each executive officer, and also taking into account new responsibilities, increases in pay levels of competitors, and such other matters as the Board of Trustees and Special Compensation Committee, as applicable, deemed appropriate. The Board of Trustees and Special Compensation Committee, as applicable, also considered, where appropriate, non-financial performance achievements by the Trust and its employees. During the fiscal year ended July 31, 1998, Mr. William Newman, the Trust's Chief Executive Officer during the fiscal year, received a base salary of $517,115. In determining the base salary paid to Mr. William Newman, the Special Compensation Committee took into consideration his experience and stature in the real estate community, the base salaries paid to chief executive officers in the comparison peer groups, and the Trust's earnings and returns on shareholder equity. Annual Bonus All of the Trust's executive officers (including the Named Officers) historically were eligible for an annual cash bonus. In determining the amount of annual cash bonuses, if any, to be paid to executive officers, the Board of Trustees and Special Compensation Committee, as applicable, at the end of each fiscal year, reviewed the performance of the Trust and, if appropriate, the Common Shares, during such fiscal year, and non-financial performance measures such as the respective 42 45 executive's performance, effort and role in promoting the long-term strategic growth of the Trust, as well as such other matters as the Board of Trustees and Special Compensation Committee, as applicable, deemed appropriate. The Trust's Chief Executive Officer during fiscal 1998, Mr. William Newman, received an annual bonus of $125,000 for the fiscal year. Share Options Under the Trust's Amended and Restated 1985 Incentive Stock Option Plan, the 1991 Stock Option Plan and the 1997 Stock Option Plan (collectively, the "Option Plans"), all of which were approved by shareholders, options to purchase Common Shares historically could be granted to the Trust's employees, including the Named Officers. The Option Plans are administered by the Stock Option Committee. Awards were based on, among other things, a review of compensation data from the peer group, information on the optionee's total compensation, the optionee's expected future contributions to the Trust's achievement of its long-term performance goals and the Trust's dependence on the optionee's efforts. The Trust historically believed that significant equity interests in the Trust held by management aligned their interests with those of the shareholders. Common Share options generally were granted with an exercise price equal to the market price of the Common Shares on the date of grant and vested pursuant to schedules set in the grants. Generally, options were not exercisable until at least one year from the date of grant, and thereafter were exercisable annually only as a percentage of the total number of Common Shares covered by the options. The Board of Trustees believed that the vesting schedule gave executives the incentive to create shareholder value over the long term because the full benefit of the compensation package cannot be realized unless Common Share price appreciation occurs over a number of years. In fiscal 1998, stock options to purchase 112,500 Common Shares were granted under the Option Plans to the Trust's Chief Executive Officer during the fiscal year, Mr. William Newman. Conclusion Through the policies described above, a very significant portion of the Trust's executive compensation historically was linked to individual and business performance. However, the changes of the business cycle from time to time may have resulted in an imbalance for a particular period. 43 46 The foregoing report has been furnished as of September 25, 1998 by the Board of Trustees and the Special Compensation Committee. Dean Bernstein William Newman Raymond H. Bottorf James M. Steuterman Norman Gold John Wetzler Arnold Laubich Gregory White Melvin Newman 44 47 Share Price Performance Graph The following table compares the cumulative total shareholder return on the Common Shares for the period commencing August 1, 1993 through July 31, 1998 with the cumulative total return on the Standard & Poor's 500 Stock Index (the "S&P 500") and the NAREIT All REIT Total Return Index (1) (the "NAREIT Index") over the same period. Total return values for the S&P 500, the NAREIT Index and the Common Shares were calculated based on cumulative total return assuming the investment of $100 in the S&P 500, the NAREIT Index and the Common Shares on August 1, 1993, and assuming reinvestment of dividends. The shareholder return shown on the graph below is not indicative of future performance. [COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN GRAPHIC]
1993 1994 1995 1996 1997 1998 ---- ---- ---- ---- ---- ---- New Plan Realty Trust 100 96 105 110 125 127 NAREIT 100 104 111 130 178 172 S&P 500 100 105 133 155 235 281
- ----------- (1) The NAREIT All REIT Total Return Index (consisting of 213 companies with a total market capitalization of approximately $148.7 billion) is maintained by the National Association of Real Estate Investment Trusts, Inc. and is published monthly based on the last closing prices of the preceding month. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT (a) Security Ownership of 5% Holders The following table sets forth information regarding the beneficial ownership of Common Shares by persons known by the Trust to own beneficially more than five percent of the Common Shares outstanding as of September 23, 1998: 45 48
Amount and Nature of Beneficial Name and Business Address Ownership Percent of Class ------------------------- ---------- ---------------- Stichting Pensioenfonds............... 4,871,900 8.1% Oude Lindestraat 70 Correspondentieadres, postbus 2980, 6401 DL Heerlen The Netherlands
The Trust and Stichting Pensioenfonds (the "Dutch Fund") entered into a purchase agreement dated as of December 18, 1990 relating to the sale by the Trust, and the purchase by the Dutch Fund, of certain Common Shares. This purchase agreement set forth, among other things, certain ongoing rights and obligations of the Trust and the Dutch Fund in connection with the Dutch Fund's ownership of Common Shares. As a result of the consummation of the Merger, on September 28, 1998, the Trust became a wholly owned subsidiary of New Plan Excel and the Dutch Fund's Common Shares were converted into shares of New Plan Excel Common Stock. (b) Security Ownership of Trustees and Executive Officers The following table sets forth, as of September 23, 1998, certain information as to the beneficial ownership of the Common Shares, including Common Shares as to which a right to acquire beneficial ownership exists (for example, through the exercise of Common Share options) within the meaning of Rule 13d-3(d)(1) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), by (i) the trustees and nominees for election as trustees, (ii) the Named Officers and (iii) all executive officers and trustees as a group.
Amount and Nature of Name and Business Address (1) Beneficial Ownership (2) Percent of Class - ----------------------------- ------------------------ ---------------- William Newman...................... 1,907,538 (3) 3.15% Arnold Laubich...................... 860,267 (4) 1.42% James M. Steuterman................. 76,592 (5) (6) Melvin Newman....................... 627,738 (7) 1.04% Norman Gold......................... 12,499 (8) (6) Dean Bernstein...................... 60,177 (9) (6) Raymond H. Bottorf.................. 9,000 (10) (6) John Wetzler........................ 9,070 (11) (6) Gregory White....................... 10,000 (12) (6) Steven F. Siegel.................... 45,239 (13) (6) Thomas J. Farrell................... 15,014 (14) (6) All Executive Officers and Trustees as a Group (14 individuals).................. 3,734,468 6.11%
- ---------- (1) The business address of each person is 1120 Avenue of the Americas, New York, New York 10036. (2) Unless otherwise indicated, the person has sole voting and investment power with respect to such Common Shares. 46 49 (3) Includes 39,627 Common Shares owned by Mr. Newman's wife, 7,289 Common Shares held by Mr. Newman as custodian for his grandchildren and 64,512 Common Shares held by a family charitable foundation, as well as 523,750 Common Shares which Mr. Newman has the right to acquire upon exercise of share options. Mr. Newman disclaims any beneficial interest in the Common Shares held for his grandchildren and by the family charitable foundation. (4) Includes 48,315 Common Shares owned by Mr. Laubich's wife, 28,273 Common Shares held jointly with his wife (as to which Common Shares Mr. Laubich shares voting and investment power), and 18,647 Common Shares held by his wife and adult daughter jointly, as well as 523,750 Common Shares which Mr. Laubich has the right to acquire upon exercise of share options. Mr. Laubich disclaims any beneficial interest in the Common Shares held jointly by his wife and daughter. (5) Includes 1,827 Common Shares held jointly with Mr. Steuterman's wife (as to which Common Shares Mr. Steuterman shares voting and investment power), 1,181 Common Shares held by Mr. Steuterman as custodian for his children, and 42,500 Common Shares which Mr. Steuterman has the right to acquire upon exercise of share options. (6) Amount owned does not exceed 1% of class. (7) Includes 23,547 Common Shares owned by Mr. Newman's wife and 64,750 Common Shares held by The Morris and Ida Newman Family Foundation (the "Foundation"), of which Mr. Newman is the trustee, as well as 4,000 Common Shares which Mr. Newman has the right to acquire upon exercise of share options. Mr. Newman disclaims any beneficial interest in the Common Shares held by the Foundation. (8) Includes 1,200 Common Share which Mr. Gold has the right to acquire upon exercise of share options. (9) Includes 21,341 Common Shares owned by Mr. Bernstein's wife, 1,740 Common Shares held jointly with his wife (as to which Common Shares Mr. Bernstein shares voting and investment power), and 31,500 Common Shares which Mr. Bernstein has the right to acquire upon exercise of share options. (10) Represents 9,000 Common Shares which Mr. Bottorf has the right to acquire upon exercise of share options. (11) Includes 608 Common Shares owned by Mr. Wetzler's wife and 235 Common Shares owned by Mr. Wetzler as custodian for his children, as well as 8,000 Common Shares which Mr. Wetzler has the right to acquire upon exercise of share options. Mr. Wetzler disclaims any beneficial interest in the Common Shares held by his children. (12) Represents 1,000 Common Shares held jointly with Mr. White's wife (as to which Common Shares Mr. White shares voting and investment power) and 1,000 Common Shares held by Mr. White as custodian for his children, as well as 8,000 Common Shares which Mr. White has the right to acquire upon exercise of share options. (13) Includes 39,350 Common Shares which Mr. Siegel has the right to acquire upon exercise of share options. (14) Includes 13,250 Common Shares which Mr. Farrell has the right to acquire upon exercise of share options. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS (a) Transactions with Trustees and Executive Officers Norman Gold is a partner in the law firm of Altheimer & Gray. His firm has rendered various legal services to the Trust during the past fiscal year and is continuing to render legal services to the Trust. John Wetzler is the president of Nautica Retail U.S.A., Inc., affiliates of which are tenants at some of the Trust's properties. The following loans were made by the Trust over a number of years primarily to assist the officers in their purchase of Common Shares of the Trust. Such loans are unsecured except as specifically noted. As of July 31, 1998, Arnold Laubich, President and Chief Operating Officer and Trustee as of such date, was indebted to the Trust in the aggregate amount of $25,000 (which amount is $140,000 less than his indebtedness to the Trust as of July 31, 1997). The amount owed is represented by a demand note bearing interest at 6% per annum. As of July 31, 1998, William Kirshenbaum, Vice President and Treasurer as of such date, was indebted to the Trust in the aggregate amount of $378,398 47 50 (which amount is $58,494 less than his indebtedness to the Trust as of July 31, 1997). The amount owed is represented by (i) four demand notes in the aggregate amount of $191,398, each bearing interest at 5% per annum, (ii) two demand notes in the aggregate amount of $17,000, each bearing interest at 8.375% per annum, and (iii) a $170,000 note bearing interest at 6% per annum and due January 31, 2000 (which is collateralized by a mortgage). As of July 31, 1998, James M. Steuterman, Executive Vice President and Trustee, was indebted to the Trust in the aggregate amount of $575,505. The amount owed is represented by (i) three demand notes in the aggregate amount of $289,170, each bearing interest at 5% per annum, and (ii) two demand notes in the aggregate amount of $286,335, each bearing interest at 6% per annum. As of July 31, 1998, Dean Bernstein, Vice President--Administration and Finance and trustee, was indebted to the Trust in the aggregate amount of $95,062, represented by a demand note bearing interest at a rate of 5% per annum. As of July 31, 1998, Steven F. Siegel, General Counsel and Secretary, was indebted to the Trust in the aggregate amount of $111,881. The amount owed is represented by two demand notes, each bearing interest at 5% per annum. As of July 31, 1998, James DeCicco, Senior Vice President--Leasing as of such date, was indebted to the Trust in the aggregate amount of $145,174. The amount owed is represented by (i) two demand notes in the aggregate amount of $9,700, each bearing interest at 6% per annum, and (ii) a $135,474 note bearing interest at 8.5% per annum and due October 1, 2024 (which is collateralized by a mortgage). Pursuant to an agreement dated June 3, 1982, Mr. William Newman, as nominee for the Trust, purchased a cooperative apartment at 114 East 72nd Street to be used to further business purposes of the Trust for a price of $290,000. The Trust has paid assessment, taxes and all other payments with respect to the use and upkeep of the apartment, which has primarily been used by Mr. Newman. Such payments totaled approximately $27,800, $26,000 and $20,000 in fiscal 1998, 1997 and 1996, respectively. On September 24, 1998, Mr. Newman exercised his option pursuant to the June 3, 1982 agreement to purchase the apartment for the original $290,000 purchase price. The Trust leases an office building from Page Associates on a net lease basis for a current rent of approximately $184,000 per year (rental payments of approximately $183,000, $180,000 and $178,000 were made to Page Associates in fiscal 1998, 1997 and 1996, respectively). The Trust has leased this building from Page Associates since 1974. Page Associates is a partnership owned in equal proportions by William Newman, Melvin Newman, the estate of Joseph Newman and Arnold Laubich. The Trust subleases the office building which it leases from Page Associates and has received rent in excess of all payments made to Page Associates and other real estate expenses in each of the years it has rented the building from Page Associates. (b) Compensation Committee Interlocks and Insider Participation The Board of Trustees does not have a Compensation Committee. Consequently, the Board of Trustees performs the functions of such committee; however, as of July 31, 1998, the Special Compensation Committee performed such function with respect to Messrs. William Newman, Laubich, Steuterman and Bernstein. It should be noted, though, that the amount of compensation paid by the Trust to its officers and the respective terms of employment of such officers for the year ended July 31, 1998 were, with the exception of the four above-mentioned individuals, determined primarily by Messrs. William Newman and Laubich, each of whom served as of such date both as a trustee and as an executive officer of the Trust. In addition, the number of options to be granted to the trustees and employees of the Trust under the terms of the Option Plans for the fiscal year ended July 31, 1998 was determined by the Option Plans' administrators as of such date, Messrs. William Newman, Laubich and Gold. 48 51 PART IV ITEM 14. EXHIBITS, CONSOLIDATED FINANCIAL STATEMENTS, CONSOLIDATED FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (a) Consolidated Financial Statements. The following documents are filed as a part of this report: The response to this portion of Item 14 is submitted as a separate section of this report. (b) Reports on Form 8-K filed during the three months ended July 31, 1998. 1. Form 8-K dated May 14, 1998 containing items 5 and 7. 2. Form 8-K dated May 19, 1998 containing item 5. (c) Exhibits. The following documents are filed as exhibits to this report: *3.1 Amended and Restated Declaration of Trust of New Plan Realty Trust dated as of January 15, 1996 filed as Exhibit 99.3 to the Registrant's Form 8-K dated May 24, 1996. 3.2 Certificate of Amendment of Amended and Restated Declaration of Trust of New Plan Realty Trust dated September 25, 1998. *4.1 Specimen Certificate for Shares of Beneficial Interest filed as Exhibit 4.1 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *4.2 Certificate of Designation Supplementing the Amended and Restated Declaration of Trust of New Plan Realty Trust filed as Exhibit 4.1 to the Registrant's Form 8-K dated July 2, 1997. *4.3 Deposit Agreement dated as of July 3, 1997 among New Plan Realty Trust and Bank Boston N.A. filed as Exhibit 4.5 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *4.4 Specimen Certificate for 7.80% Series A Cumulative Step-Up Premium Rate Preferred Shares filed as Exhibit 4.4 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *4.5 Specimen Depositary Receipt filed as Exhibit 4.5 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *9.1 Agreement dated February 26, 1979 among William Newman, Joseph Newman and Melvin Newman filed as Exhibit 9 to Registration Statement No. 2--63669. *9.2 Purchase Agreement dated December 18, 1990 between New Plan Realty Trust and Beleggingsmaatschappij Midas B.V. (presently known as Stichting Pensioenfonds) filed as Exhibit 9.5 to the Registrant's Form 10-K for the fiscal year ended July 31, 1994. *9.3 Termination of Purchase Agreement dated December 17, 1981 between New Plan Realty Trust and Merchant Navy Officers Pension Fund Trustees Limited (presently known as MNOPF Trustees Limited) filed as Exhibit 9.6 to the Registrant's Form 10-K for the fiscal year ended July 31, 1995. 49 52 *10.1 Credit Agreement by and among New Plan Realty Trust, the Lenders party thereto and The Bank of New York, as agent, dated as of October 20, 1996 filed as Exhibit 10.1 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. 10.2 Assignment and Assumption Agreement dated December 1, 1997 by and among New Plan Realty Trust, Bank Hapoalim B.M. and The Bank of New York. 10.3 Waiver and Amendment to Credit Agreement dated as of September 25, 1998 by and among New Plan Realty Trust, the Lenders party thereto and The Bank of New York, as agent. 10.4 Assumption and Substitution Agreement dated as of September 28, 1998 by and among New Plan Excel Realty Trust, Inc., New Plan Realty Trust, the Lenders party thereto and The Bank of New York, as agent. 10.5 Unconditional Guaranty of Payment and Performance dated as of September 28, 1998 by and between New Plan Realty Trust and BankBoston N.A. *10.6 Senior Securities Indenture between New Plan Realty Trust and The First National Bank of Boston, as Trustee, dated as of March 29, 1995 filed as Exhibit 4.2 to Registration Statement No. 33-60045. *10.7 7.75% Senior Note Due April 6, 2005 filed as Exhibit 10.7 to the Registrant's Form 10-K for the fiscal year ended July 31, 1995. *10.8 6.8% Senior Note Due May 15, 2002 filed as Exhibit 10.8 to the Registrant's Form 10-K for the fiscal year ended July 31, 1995. *10.9 Distribution Agreement dated May 24, 1996 by and among New Plan Realty Trust, Lehman Brothers, Lehman Brothers Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated and Smith Barney Inc., filed as Exhibit 1 to the Registrant's Form 8-K dated May 24, 1996. *10.10 Form of Medium Term Note (Fixed Rate) filed as Exhibit 99.1 to the Registrant's Form 8-K dated May 24, 1996. *10.11 Form of Medium Term Note (Floating Rate) filed as Exhibit 99.2 to the Registrant's Form 8-K dated May 24, 1996. *10.12 Distribution Agreement dated December 6, 1996 by and among New Plan Realty Trust, Lehman Brothers, Lehman Brothers Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated, Salomon Brothers Inc. and Smith Barney Inc., filed as Exhibit 1 to the Registrant's Form 8-K dated December 12, 1996. *10.13 Form of Medium Term Note (Fixed Rate) filed as Exhibit 4.1 to the Registrant's Form 8-K dated December 12, 1996. *10.14 Form of Medium Term Note (Floating Rate) filed as Exhibit 4.2 to the Registrant's Form 8-K dated December 12, 1996. 50 53 *10.15 Agreement and Plan of Merger, dated May 14, 1998, as amended as of August 7, 1998, among Excel Realty Trust, Inc., ERT Merger Sub, Inc. and New Plan Realty Trust filed as Exhibit 2.1 to the Registrant's Form 8-K dated October 13, 1998. 12 Ratio of Earnings to Fixed Charges. 21 Subsidiaries of the Registrant. 23 Consent of PricewaterhouseCoopers LLP. 27(1) Financial Data Schedule. 99.1 Pro Forma Financial Data of New Plan Excel Realty Trust, Inc. - ---------- *Incorporated herein by reference as above indicated. (1) Filed as exhibit to electronic filing only. (d) Financial Statement Schedules. The following documents are filed as a part of this report: The response to this portion of Item 14 is submitted as a separate section of this report. 51 54 ANNUAL REPORT ON FORM 10-K ITEM 8 AND ITEM 14(a)(1), (a)(2) AND (d) LIST OF CONSOLIDATED FINANCIAL STATEMENTS AND CONSOLIDATED FINANCIAL STATEMENT SCHEDULES YEAR ENDED JULY 31, 1998 NEW PLAN REALTY TRUST AND SUBSIDIARIES NEW YORK, NEW YORK 55 NEW PLAN REALTY TRUST AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND CONSOLIDATED FINANCIAL STATEMENT SCHEDULES Report of Independent Auditors.............................................................F-2 Consolidated Balance Sheets as of July 31, 1998 and 1997...................................F-3 Consolidated Statements of Income for the years ended July 31, 1998, 1997 and 1996.......................................................F-5 Consolidated Statements of Changes in Shareholders' Equity for the years ended July 31, 1998, 1997 and 1996.........................................F-6 Consolidated Statements of Cash Flows for the years ended July 31, 1998, 1997 and 1996.......................................................F-7 Notes to Consolidated Financial Statements.................................................F-9 Schedules II - Valuation and Qualifying Accounts..........................................F-23 III - Real Estate and Accumulated Depreciation...................................F-24 IV - Mortgage Loans and Notes Receivable on Real Estate.........................F-41
All other schedules for which provision is made in the applicable regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted. 56 REPORT OF INDEPENDENT AUDITORS To the Trustees and Shareholders of New Plan Realty Trust: We have audited the consolidated financial statements and financial statement schedules of New Plan Realty Trust and Subsidiaries listed in Item 14(a) of this Form 10-K. These financial statements and financial statement schedules are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial statement schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audits 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 consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of New Plan Realty Trust and Subsidiaries as of July 31, 1998 and 1997, and the consolidated results of their operations and their cash flows for each of the three years in the period ended July 31, 1998 in conformity with generally accepted accounting principles. In addition, in our opinion, the financial statement schedules referred to above, when considered in relation to the basic financial statements taken as a whole, present fairly, in all material respects, the information required to be included therein. PRICEWATERHOUSECOOPERS LLP New York, New York September 9, 1998, except for Note Q for which the date is September 28, 1998 F-2 57 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS JULY 31, 1998 AND 1997 (In Thousands)
1998 1997 ---------- ---------- ASSETS: Real estate, at cost Land $ 272,176 $ 232,502 Buildings and improvements 1,180,562 1,045,273 ---------- ---------- 1,452,738 1,277,775 Less accumulated depreciation and amortization 136,978 105,866 ---------- ---------- 1,315,760 1,171,909 Cash and cash equivalents 26,284 42,781 Marketable securities 1,787 2,034 Mortgages and notes receivable 13,878 23,107 Receivables Trade and notes, net of allowance for doubtful accounts (1998 - $7,926; 1997 - $5,581) 14,025 12,035 Other 1,376 1,464 Prepaid expenses and deferred charges 7,823 5,000 Other assets 3,592 2,814 ---------- ---------- TOTAL ASSETS $1,384,525 $1,261,144 ========== ==========
See Notes to Consolidated Financial Statements. F-3 58 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS JULY 31, 1998 AND 1997 (In Thousands)
1998 1997 ---------- ---------- LIABILITIES: Mortgages payable $ 114,099 $ 65,573 Notes payable, net of unamortized discount (1998 - $1,211; 1997 - $1,366) 462,789 412,634 Other liabilities 37,520 33,359 Tenants' security deposits 5,590 4,623 ---------- ---------- TOTAL LIABILITIES 619,998 516,189 ---------- ---------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Preferred shares Par value $1.00, unlimited authorization; issued and outstanding (1998 and 1997 - Series A 150,000 Cumulative Preferred Shares), $75,000 redemption value 72,775 72,775 Shares of beneficial interest Without par value, unlimited authorization; issued and outstanding (1998 - 59,874; 1997 - 58,934) 759,853 738,011 Less: loans receivable for purchase of shares of beneficial interest 2,306 2,814 Add: unrealized gain on securities reported at fair value 813 1,057 ---------- ---------- 831,135 809,029 Less distributions in excess of net income 66,608 64,074 ---------- ---------- TOTAL SHAREHOLDERS' EQUITY 764,527 744,955 ---------- ---------- TOTAL LIABILITIES AND SHAREHOLDER' EQUITY $1,384,525 $1,261,144 ========== ==========
See Notes to Consolidated Financial Statements. F-4 59 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS ENDED JULY 31, 1998, 1997 AND 1996 (In Thousands Except For Per Share Amounts)
1998 1997 1996 --------- --------- --------- Revenues: Rental income and related revenues $ 246,309 $ 202,093 $ 162,821 Interest and dividend income 3,950 4,728 4,785 --------- --------- --------- Total revenues 250,259 206,821 167,606 --------- --------- --------- Operating expenses: Operating costs 61,417 52,584 39,531 Real estate and other taxes 22,850 18,449 15,788 Interest expense 36,815 28,256 17,561 Depreciation and amortization 31,622 25,006 20,004 Provision for doubtful accounts 4,171 3,283 1,984 --------- --------- --------- Total operating expenses 156,875 127,578 94,868 --------- --------- --------- 93,384 79,243 72,738 Administrative expenses 2,770 2,203 2,616 --------- --------- --------- Income Before (Loss)/Gain on Sale of Properties and Securities: 90,614 77,040 70,122 (Loss)/gain on sale of properties and securities, net (41) (3) 399 --------- --------- --------- Net Income 90,573 77,037 70,521 Preferred Dividend required (5,850) (461) -- --------- --------- --------- Net Income applicable to Shares of Beneficial Interest $ 84,723 $ 76,576 $ 70,521 ========= ========= ========= Net Income Per Share of Beneficial Interest Basic $ 1.43 $ 1.31 $ 1.25 Diluted $ 1.42 $ 1.30 $ 1.25 Cash Distribution Per Share of Beneficial Interest $ 1.475 $ 1.435 $ 1.395 Weighted Average Shares of Beneficial Interest Outstanding Basic 59,365 58,461 56,484 Diluted 59,774 58,735 56,642
See Notes to Consolidated Financial Statements. F-5 60 NEW PLAN REALTY TRUST CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY For the Years Ended July 31, 1998, 1997 and 1996
Preferred Shares Shares of Beneficial Interest Notes Receivable ---------------------- ---------------------------- ---------------- Issued Amount Issued Amount ------ ------ ------ ------ Balance July 31, 1995 53,262 $622,562 $(3,370) Net income Dividends paid Dividend reinvestment 738 15,126 Exercise of stock options 9 165 Repayment of loans 286 Increase during year Issuance of preferred shares 4,060 81,227 -------- --------- ------- -------- -------- Balance July 31, 1996 58,069 719,080 (3,084) Net income Dividends paid Dividend reinvestment 750 16,475 Exercise of stock options 115 2,456 Repayment of loans 270 Increase during year Issuance of preferred shares 150 72,775 -------- --------- ------- -------- -------- Balance July 31, 1997 150 72,775 58,934 738,011 (2,814) Net income Dividends paid Dividend reinvestment 765 18,197 Exercise of stock options 175 3,645 Repayment of loans 508 Decrease during year -------- --------- ------- -------- -------- Balance July 31, 1998 150 $72,775 59,874 $759,853 $(2,306) ======= ======= ====== ======== ======== Cumulative Unrealized Distributions in Total Gains on Excess of Net Shareholders' Securities Income Equity ---------- ---------------- -------------- Balance July 31, 1995 $ 182 $(48,845) $570,529 Net income 70,521 70,521 Dividends paid (78,962) (78,962) Dividend reinvestment 15,126 Exercise of stock options 165 Repayment of loans 286 Increase during year 461 461 Issuance of preferred shares 81,227 -------- --------------- ----------- Balance July 31, 1996 643 (57,286) 659,353 Net income 77,037 77,037 Dividends paid (83,825) (83,825) Dividend reinvestment 16,475 Exercise of stock options 2,456 Repayment of loans 270 Increase during year 414 414 Issuance of preferred shares 72,775 -------- --------------- ----------- Balance July 31, 1997 1,057 (64,074) 744,955 Net income 90,573 90,573 Dividends paid (93,107) (93,107) Dividend reinvestment 18,197 Exercise of stock options 3,645 Repayment of loans 508 Decrease during year (244) (244) -------- --------------- ----------- Balance July 31, 1998 $ 813 $(66,608) $764,527 ====== ========== ========
See Notes to Consolidated Financial Statements F-6 61 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JULY 31, 1998, 1997 AND 1996 (In Thousands)
1998 1997 1996 --------- --------- --------- OPERATING ACTIVITIES Net Income $ 90,573 $ 77,037 $ 70,521 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 31,622 25,006 20,004 Loss/(Gain) on sale of properties, net 67 10 (540) (Gain)/Loss on sale of securities, net (26) (7) 141 Changes in operating assets and liabilities, net: Change in trade and notes receivable (4,335) (2,054) (5,776) Change in other receivables 88 (355) 13 Change in allowance for doubtful accounts 2,345 1,604 1,054 Change in other liabilities 4,161 3,475 8,239 Change in net sundry assets and liabilities (2,988) 605 (250) --------- --------- --------- NET CASH PROVIDED BY OPERATING ACTIVITIES 121,507 105,321 93,406 --------- --------- --------- INVESTING ACTIVITIES Sales of marketable securities 29 484 4,274 Purchases of marketable securities (1) (2) __ Net proceeds from the sale of properties (67) 3,862 3,474 Purchases and improvement of properties (123,036) (282,607) (186,008) Repayment of mortgage notes receivable, net 9,229 491 821 --------- --------- --------- NET CASH USED IN INVESTING ACTIVITIES (113,846) (277,772) (177,439) --------- --------- ---------
See Notes to Consolidated Financial Statements (Continued on next page) F-7 62 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JULY 31, 1998, 1997 AND 1996 (CONTINUED FROM PREVIOUS PAGE) (In Thousands)
1998 1997 1996 --------- --------- --------- FINANCING ACTIVITIES Distributions to shareholders of shares (93,107) (83,825) (78,962) Issuance of preferred shares pursuant to a public offering, net of offering costs -- 72,775 -- Issuance of shares of beneficial interest pursuant to dividend reinvestment plan 18,197 16,475 15,126 Issuance of shares of beneficial interest pursuant to public offering, net of loans receivable and offering costs -- 81,228 Issuance of shares of beneficial interest upon exercise of stock options 3,645 2,456 164 Proceeds from short-term borrowing -- 12,000 19,500 Repayment of short-term borrowing -- (31,500) -- Proceeds from sale of notes 50,000 223,144 10,000 Principal payments on mortgages (3,401) (862) (10,898) Repayment of loans receivable for the purchase of shares of beneficial interest 508 269 286 --------- --------- --------- NET CASH PROVIDED BY FINANCING ACTIVITIES (24,158) 210,932 36,444 --------- --------- --------- (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (16,497) 38,481 (47,589) Cash and cash equivalents at beginning of year 42,781 4,300 51,889 --------- --------- --------- CASH AND CASH EQUIVALENTS AT END OF YEAR $ 26,284 $ 42,781 $ 4,300 ========= ========= =========
See Notes to Consolidated Financial Statements. F-8 63 NEW PLAN REALTY TRUST AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Income Taxes: New Plan Realty Trust was organized July 31, 1972 as a Massachusetts Business Trust. New Plan Realty Trust and subsidiaries (the "Trust") have elected to be taxed as a Real Estate Investment Trust ("REIT") under the applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"). Accordingly, the Trust does not pay Federal income tax on income as long as income distributed to shareholders is at least equal to 95% of real estate investment trust taxable income and pays no Federal income tax on capital gains distributed to shareholders. The Trust may be subject to tax by certain states that do not recognize the REIT. Provision for such taxes has been included in real estate and other taxes. Basis of Consolidation: The consolidated financial statements include the accounts of New Plan Realty Trust and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated. Certain prior period amounts have been reclassified to conform to the current year presentation. Real Estate: Real estate is carried at cost less accumulated depreciation and amortization. For financial reporting purposes, depreciation is calculated on the straight-line method based on the estimated useful lives of the assets ranging from 5 to 40 years. Amortization of leasehold improvements is calculated on a straight-line basis over the shorter of the life of the lease or the estimated useful life of the asset. If there is an event or a change in circumstances that indicates that the basis of the Trust's property may not be recoverable the Trust's policy is to assess any impairment in value by making a comparison of the current and projected operating cash flows (excluding interest and income taxes) of the property over its remaining useful life, on an undiscounted basis, to the carrying amount of the property. Such carrying amounts would be adjusted, if necessary, to reflect an impairment in the value of the property. The Trust records sales when, among other criteria, the parties are bound by the terms of a contract, all consideration has been exchanged and all conditions precedent to closing have been performed. These conditions are usually met at the time of closing. The cost and related accumulated depreciation of assets sold are removed from the respective accounts and any gain or loss is recognized in income. New Accounting Standards: During 1998, the Trust adopted the provisions of SFAS 128 and SFAS 129. SFAS 129 had no impact on the financial statements. Pursuant to SFAS 128, the Trust restated all per share data to conform with the provisions of that pronouncement (See Note I). During fiscal 1998, the Financial Accounting Standards Board issued (a) No. 130 "Reporting Comprehensive Income" ("SFAS 130"), which is effective for fiscal years beginning after December 15, 1997, (b) No. 131 "Disclosures About Segments of an Enterprise and Related Information" ("SFAS 131"), which is effective for fiscal years beginning after December 15, 1997, (c) No. 132 "Employees Disclosure About Pensions and Other Postretirement Benefits" ("SFAS 132") which is effective for fiscal years beginning after December 15, 1997 and (d) No. 133 "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), which is effective for fiscal years beginning after June 15, 1999. Management believes that the implementation of SFAS 130, 131, 132 and 133 will not have a material impact on the Trust's financial statements. F-9 64 In addition, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities" ("SOP 98-5") and Statement of Position 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use" ("SOP 98-1"), which are effective for fiscal years beginning after December 15, 1998. Further, the Emerging Issues Task Force of the Financial Accounting Standards Board released Issue No. 97-11, "Accounting for Internal Costs Relating to Real Estate Property Acquisitions" ("EITF 97-11") and Issue No. 98-9, "Accounting for Contingent Rent in Interim Financial Periods" ("EITF 98-9"). SOP 98-5 requires that certain costs incurred in conjunction with start-up activities be expensed. SOP 98-1 provides guidance on whether the costs of computer software developed or obtained for internal use should be capitalized or expensed. EITF 97-11 requires that the internal pre-acquisition costs of identifying and acquiring operating property be expensed as incurred. EITF 98-9 requires that contingent revenue not be accrued until a future specified sales target is achieved. Management believes that, when adopted, SOP 98-5 and SOP 98-1 will not have a significant impact on the Trust's financial statements. EITF 97-11 and 98-9 were adopted during fiscal year 1998 and did not have a material impact on the Trust's financial statements. Cash Equivalents: Cash equivalents consist of short-term, highly liquid debt instruments with original maturities of three months or less. Items classified as cash equivalents include insured bank certificates of deposit and commercial paper. At times cash balances at a limited number of banks may exceed insurable amounts. The Trust believes it mitigates its risk by investing in or through major financial institutions. Recoverability of investments is dependent upon the performance of the issuer. Revenue Recognition: Lease agreements between the Trust and retail tenants generally provide for additional rentals based on such factors as percentage of tenants' sales in excess of specified volumes, increases in real estate taxes, increases in Consumer Price Indices and common area maintenance charges. These additional rentals are generally included in income when reported to the Trust or when billed to tenants. The Trust recognizes rental income from leases with scheduled rent increases on a straight-line basis over the lease term. Deferred rent receivable, included in trade and notes receivable, represents the difference between the straight-line rent and amounts currently due. Concentration of Credit Risk: No tenant or single property accounts for more than 5% of the Trust's revenues. 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, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. The most significant assumptions and estimates relate to depreciable lives, valuation of real estate and the recoverability of mortgage notes and trade accounts receivable. Internal Software Costs: Any costs associated with modifying computer software for the year 2000 are expensed as incurred. Management does not believe future costs to be incurred will be material. F-10 65 NOTE B - MARKETABLE SECURITIES The Trust has classified all investments in equity securities as available-for-sale. All investments are recorded at current market value with an offsetting adjustment to shareholders' equity (Amounts in Thousands).
July 31, 1998 1997 - -------- ------ ------ Amortized cost/cost basis $ 974 $ 977 Unrealized holdings gains 813 1,057 ------ ------ Fair value $1,787 $2,034 ====== ======
The net decrease in unrealized holding gains that has been included as a separate component of shareholders' equity is $244 for 1998. The weighted average method is used to determine realized gain or loss on securities sold. The market value of marketable securities is based on quoted market prices as of July 31, 1998 and 1997. NOTE C - MORTGAGES & NOTES RECEIVABLE Mortgages and Notes Receivable are collateralized principally by real property and consist of the following (Amounts in Thousands):
July 31, 1998 1997 ------- ------- 10% purchase money first mortgage, due August 31, 1998 $ 5,180 $ 5,180 9.38% purchase money first mortgage, due July 30, 1999 4,205 4,205 9.375% purchase money first mortgage, due July 27, 2002 -- 10,350 12% leasehold mortgage, due May 1, 2008 864 890 11.5% note, due April 30, 2004 212 237 8.75% purchase money first mortgage, due July 23, 1998 -- 795 9% purchase money first mortgage, due July 23, 2000 645 -- 7.2% purchase money first mortgage, due May 9, 2001 750 750 8.75% purchase money first mortgage, due July 23, 2001 700 700 10% leasehold mortgage, due May 31, 2008 1,322 -- ------- ------- $13,878 $23,107 ======= ======= NOTE D - OTHER RECEIVABLES (Amounts in Thousands) July 31, 1998 1997 - -------- ------- ------- Interest and dividends $ 266 $ 599 Notes receivable 46 338 Due from officers, trustees and employees (1) 655 497 Miscellaneous receivables 409 30 ------- ------- $ 1,376 $ 1,464 ======= =======
(1) Amounts, which are interest bearing, are either due on demand or have scheduled maturities. F-11 66 NOTE E - MORTGAGES AND CREDIT FACILITY Mortgages are collateralized by real property with aggregate carrying amounts of approximately $269.7 million before accumulated depreciation and amortization. As of July 31, 1998, mortgages payable bear interest at rates ranging from 3.79% to 10.75%, having a weighted average rate of 7.795% per annum and mature from 1998 to 2008. Scheduled principal payments during each of the next five fiscal years and thereafter are approximately as follows (Amounts in Thousands):
Year Ending July 31, Amount - -------------------- ------ 1999 $ 4,240 2000 30,873 2001 9,562 2002 21,707 2003 18,470 Thereafter 29,247 -------- Total $114,099 ========
The Trust has an unsecured revolving credit facility which provides for up to $50 million of debt through November, 1998. At July 31, 1998 there were no amounts outstanding under this facility. At the time of borrowing, the Trust can choose from three interest rate options. There are restrictive covenants that place a ceiling on total indebtedness of 50% of total capital, a ceiling on mortgage indebtedness of 40% of total capital, a ceiling on unsecured indebtedness of 100% of undepreciated real estate assets, a minimum interest coverage ratio of 2 to 1 and a minimum tangible net worth of $1,200,000,000. The Trust has outstanding approximately $40,000 of letters of credit as of July 31, 1998. Interest costs capitalized for the years ended July 31, 1998, 1997, and 1996 were approximately $12,000, $868,000, and $203,000, respectively. F-12 67 NOTE F - NOTES PAYABLE Notes Payable consists of the following (Amounts in Thousands):
Description Face Amount Due Date 1998 1997 - ----------- ----------- -------- ---- ---- 7.75% Senior notes, effective interest rate 7.95%, net of unamortized discount: 1998 - $1,019; 1997 - $1,132 $100,000 4/6/2005 $ 98,981 $ 98,868 6.80% Senior unsecured notes, effective interest rate 6.87%, net of unamortized discount: 1998 - $192; 1997 - $234 81,000 5/15/2002 80,808 80,766 7.97% unsecured notes 10,000 8/14/2026 10,000 10,000 Variable rate unsecured notes 49,000 8/3/1999 49,000 49,000 Variable rate unsecured notes 10,000 8/3/1998 10,000 10,000 5.95% unsecured notes 49,000 11/2/2026 49,000 49,000 7.65% unsecured notes 25,000 11/2/2026 25,000 25,000 7.68% unsecured notes 20,000 11/2/2026 20,000 20,000 Variable rate unsecured notes 40,000 5/15/2000 40,000 40,000 7.35% unsecured notes 30,000 6/15/2007 30,000 30,000 6.9% unsecured notes 50,000 2/15/2028 50,000 -- -------- -------- Total $462,789 $412,634 ======== ========
The Notes are uncollateralized and subordinate to mortgages payable and rank equally with debt under the revolving credit facility. Where applicable, the discount is being amortized over the life of the respective Notes using the effective interest method. Interest is payable semi-annually or quarterly and the principal is due at maturity. Among other restrictive covenants, there is a restrictive covenant that limits the amount of total indebtedness to 65% of total assets. For the year ended July 31, 1998, $387,000 of amortized discount and issuing costs were included in interest expense. F-13 68 NOTE G - OTHER LIABILITIES (Amounts in Thousands)
July 31, 1998 1997 - -------- ----- ---- Accounts payable $ 3,362 $ 2,096 Taxes payable 10,523 9,289 Interest payable on notes 9,712 7,779 Amounts due seller of property 1,952 1,467 Professional and personnel costs 1,239 1,666 Accrued construction costs 4,789 4,872 Acquisition costs 1,120 1,884 Other 3,715 2,969 Deferred rent expense and rent received in advance 1,108 1,337 ------- ------- $37,520 $33,359 ======= =======
NOTE H - SHAREHOLDERS' EQUITY The Series A Cumulative Preferred Shares are redeemable at the option of the Trust on or after June 15, 2007 at the liquidation preference of $500 a share. The preferred shares pay dividends quarterly at the rate of 7.8% of the liquidation preference per annum through September 15, 2012 and at the rate of 9.8% of the liquidation preference per annum thereafter. In connection with the issuance of the Series A Cumulative Preferred Shares, 1,500,000 depositary shares, each representing a 1/10 fractional interest in a share of cumulative preferred, were sold to the public. The Trust has the following stock option plans (the "Plans") pursuant to which the Trust has granted (and in one instance, may continue to grant) options to purchase Shares of Beneficial Interest of the Trust (the "Shares") to officers, trustees and certain key employees of the Trust: (i) the 1985 Incentive Stock Option Plan (the "1985 Plan"), (ii) the March 1991 Stock Option Plan (the "March 1991 Plan"), (iii) the Non-Qualified Stock Option Plan (the "Non-Qualified Plan"), (iv) the 1991 Stock Option Plan (the "1991 Plan") and (v) the 1997 Stock Option Plan (the "1997 Plan"). The exercise price of a Share pursuant to each of the Plans is or was required (as the case may be) to be no less than the fair market value of a Share on the date of grant. Under the 1985 Plan and the 1991 and 1997 Plans (with the exception of certain option grants of 10,000 Shares or more, as discussed below) and the Non-Qualified Plan, options are exercisable 20% per year commencing one year from the date of grant. In the case of certain option grants of 10,000 Shares or more under the 1991 Plan, such option grants are exercisable 10% after the first anniversary of the date of grant, 25% after the second anniversary of the date of grant, 45% after the third anniversary of the date of grant, 70% after the fourth anniversary of the date of grant and 100% after the fifth anniversary of the date of grant. In the case of the March 1991 Plan, 30% of the options granted are exercisable on the third anniversary of the date of grant and, thereafter, an additional 10% of the granted options are exercisable on a yearly basis. Future option grants can be made only under the 1991 and 1997 Plans. F-14 69 The following table shows the activity and balances for each stock option plan during the fiscal years indicated.
Non- March 1985 Qualified 1991 1991 1997 Options Plan Plan Plan Plan Plan - ------- ---- ---- ---- ---- ---- Outstanding July 31, 1995 351,600 5,000 1,300,000 422,250 Exercised (5,000) -- -- (4,000) Canceled (800) -- -- (20,500) Granted 3,200 -- -- 31,300 ---------- ---------- ---------- ---------- Outstanding July 31, 1996 349,000 5,000 1,300,000 429,050 Exercised (72,700) -- -- (42,100) Canceled -- -- -- (26,800) Granted -- -- -- 571,750 ---------- ---------- ---------- ---------- Outstanding July 31, 1997 276,300 5,000 1,300,000 931,900 Exercised (96,515) -- -- (78,300) Canceled (26,085) -- -- (85,350) (101,250) Granted -- -- 41,500 1,408,750 ---------- ---------- ---------- ---------- --------- Outstanding July 31, 1998 153,700 5,000 1,300,000 809,750 1,307,500 ========== ========== ========== ========== ========= Options exercisable at July 31, 1998 - ------------------------------------ Average outstanding option price, which was the market price of the shares on the dates of grant $ 22.43 $ 21.88 $ 18.88 $ 21.86 $ 24.13 Average price of options exercised during 1998 $ 20.60 -- -- $ 21.16 --
The Trust has adopted the disclosure-only provision of Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123"). Accordingly, no compensation expense has been recognized for the options described above which were granted on or after August 1, 1995. Had compensation cost for these options been determined based on the fair value on the grant date consistent with the provisions of SFAS 123, the Trust's net earnings and earnings per share of beneficial interest would have been changed to the pro forma amounts shown below. These pro forma adjustments to net income and net income per common share assume fair values of each option grant estimated using the Black-Scholes option pricing formula. The more significant assumptions underlying the determination of such fair values for options granted during 1998, 1997 and 1996 include: (i) weighted average risk-free interest rates of 5.87%, 6.66% and 6.4%, respectively; (ii) weighted average expected option lives of 6.5 years, 6.3 years and 6.3 years, respectively; (iii) an expected volatility of 18.25%, 19.3% and 15.79%, respectively, and (iv) an expected dividend yield of 6.14%, 6.12% and 6.12%, respectively. The per share weighted average fair value at the dates of grant for options awarded during 1998, 1997 and 1996 was $2.78, $3.10 and $2.83, respectively. F-15 70
Net Income Per Share of Beneficial Interest Net Income ------------------------------------------- (in thousands) Basic Diluted Year ended July 31, 1998 $ 83,904 $1.41 $1.41 Year ended July 31, 1997 76,465 1.31 1.30 Year ended July 31, 1996 70,510 1.25 1.25
The Trust has a Dividend Reinvestment and Share Purchase Plan (the "Plan") whereby shareholders may invest cash distributions and make optional cash payments to purchase Shares of the Trust without payment of any brokerage commission or service charge. The price per share of the additional shares to be purchased with invested cash distributions is the midpoint between the day's high and low sales prices on the New York Stock Exchange, less 5%. The Trust has made loans to officers, trustees and employees primarily for the purpose of purchasing its Shares. These loans are demand and term notes bearing interest at rates ranging from 5% to 9.75%. Interest is payable quarterly. F-16 71 NOTE I - NET INCOME PER SHARE OF BENEFICIAL INTEREST On January 31, 1998 the Trust adopted Financial Accounting Standard No. 128 "Earnings Per Share". All per share data has been restated to conform to the provisions of FAS 128. The following table sets forth the computation of average shares outstanding and basic earnings and diluted earnings per share (Amounts in Thousands, Except Per Share Amounts):
Year Ended July 31, 1998 1997 1996 -------- -------- -------- Numerators - ---------- Net Income $ 90,573 $ 77,037 $ 70,521 Less preferred stock dividend requirement (5,850) (461) -- -------- -------- -------- Net income available to shares of beneficial interest $ 84,723 $ 76,576 $ 70,521 ======== ======== ======== Denominators - ------------ Weighted average shares outstanding for Basic EPS 59,365 58,461 56,484 Effects of Dilutive Securities - Options 409 274 158 -------- -------- -------- Adjusted Weighted Average Shares Outstanding - For Diluted EPS 59,774 58,735 56,642 ======== ======== ======== Basic EPS $ 1.43 $ 1.31 $ 1.25 Diluted EPS $ 1.42 $ 1.30 $ 1.25
NOTE J - LEASE AGREEMENTS The Trust has entered into leases, as lessee, in connection with ground leases for shopping centers which it operates, an office building which it sublets and administrative office space for the Trust. These leases are accounted for as operating leases. The minimum annual rental commitments during the next five fiscal years and thereafter are approximately as follows (Amounts in Thousands):
Year Ending July 31, Amount - -------------------- ------ 1999 $ 1,093 2000 1,074 2001 1,070 2002 1,109 2003 1,140 Thereafter 19,237 ------- Total $24,723 =======
F-17 72 For the years ended July 31, 1998 and 1996, the lease for office space included contingent rentals for real estate tax escalations and operating expense in the amount of $10,000 and $100,000, respectively. There were no contingent rentals for the year ended July 31, 1997. In addition, ground leases provide for fixed rent escalations and renewal options. NOTE K - RENTAL INCOME UNDER OPERATING LEASES Minimum future rentals to be received during the next five fiscal years and thereafter with initial or remaining noncancellable lease terms in excess of one year are approximately as follows (Amounts in Thousands):
Year Ending July 31, Amount - -------------------- ------ 1999 $128,162 2000 111,972 2001 94,189 2002 80,958 2003 67,270 Thereafter 372,028 -------- Total $854,579 ========
The above table assumes that all leases which expire are not renewed, therefore neither renewal rentals nor rentals from replacement tenants are included. Minimum future rentals do not include contingent rentals, which may be received under certain leases on the basis of percentage of reported tenants' sales volume accounted for under EITF 98-9 (See Summary of Significant Accounting Policies), increases in Consumer Price Indices, common area maintenance charges and real estate tax reimbursements. Contingent rentals included in income for the years ended July 31, 1998, 1997 and 1996 amounted to approximately $34,421,000, $28,933,000 and $26,173,000, respectively. NOTE L - PRO FORMA FINANCIAL INFORMATION (UNAUDITED) The Trust acquired 14 shopping centers and five apartment complexes during the year ended July 31, 1998. The aggregate acquisition cost of these properties included existing mortgages and $105 million in cash. In addition, the Trust completed the merger with Excel Realty Trust during September, 1998 (See Note Q). The pro forma financial information for the years ended July 31, 1998 and 1997 shown below is based on the historical statements of the Trust after giving effect to the aforementioned acquisition of 19 properties and the merger with Excel Realty Trust as if such acquisitions took place on August 1, 1997 and 1996, respectively. F-18 73 The purchase price allocations related to the Excel merger are preliminary and are subject to adjustment based on the results of the various appraisals and analyses of fair values. The pro forma financial information is presented for informational purposes only and may not be indicative of results that would have actually occurred had the acquisitions taken place at the dates indicated or of what may occur in the future. (Amounts in Thousands, Except Per Share Data)
Year Ended July 31, 1998 1997 - ------------------- ---- ---- Pro forma total revenues $ 411,737 $ 392,259 Pro forma net income $ 153,857 $ 141,692 Pro forma net income per share of beneficial interest Basic $ 1.52 $ 1.41 Diluted $ 1.49 $ 1.38
NOTE M - QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Amounts in Thousands, Except Per Share Data)
Earnings Per Share Net ---------------------- Year Ended July 31, Revenue Income Basic Diluted 1998 - ---- First $59,507 $21,537 $ .34 $ .34 Second 61,845 22,525 .36 .35 Third 63,481 22,899 .36 .36 Fourth 65,426 23,612 .37 .37 1997 - ---- First $47,783 $19,076 $ .33 $ .33 Second 51,147 19,092 .33 .32 Third 52,066 19,088 .32 .32 Fourth 55,825 19,781 .33 .33
F-19 74 NOTE N - SUPPLEMENTAL CASH FLOW INFORMATION The Trust entered into the following non-cash investing and financing activities (Amounts in Thousands):
Year Ended July 31, 1998 1997 1996 - ------------------- ---- ---- ---- Mortgages payable assumed in the acquisition of properties $51,900 $17,500 $32,538 Mortgages receivable in connection with the sale of properties $ -- $ 700 $ 1,545
State and local income taxes paid for the year ended July 31, 1998 and 1997 were $156,000 and $872,000, respectively. There were no state and local taxes paid by the Trust for fiscal 1996. Interest paid for the years ended July 31, 1998, 1997 and 1996 was $34,876,000, $24,642,000 and $17,085,000, respectively. NOTE O - RETIREMENT SAVINGS PLAN The Trust has a Retirement Savings Plan (the "Savings Plan"). Participants in the Savings Plan may elect to contribute a portion of their earnings to the Savings Plan and the Trust may, at the discretion of the Board of Trustees, make a voluntary contribution to the Savings Plan. For the years ended July 31, 1998, 1997 and 1996, the Trust's expense for the Savings Plan was $317,000, $250,000 and $228,000, respectively. NOTE P - FINANCIAL INSTRUMENTS The estimated fair values of the Trust's financial instruments are as follows (Amounts in Thousands):
At July 31, 1998 1997 - ----------- ---- ---- Corre- Carrying Fair Carrying Fair sponding Amounts Value Amounts Value Footnote ------- ----- ------- ----- -------- Assets: Cash and cash equivalents $ 26,284 $ 26,284 $ 42,781 $ 42,781 A Marketable securities 1,787 1,787 2,034 2,034 B Mortgages and notes receivable 13,875 14,100 23,107 24,200 C Other receivables 1,376 1,376 1,464 1,464 D Liabilities: Mortgages payable 114,099 115,700 65,573 67,500 E Notes payable 462,789 501,800 412,634 429,200 F Other liabilities 37,520 37,520 35,359 35,359 G
F-20 75 The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable: Cash and cash equivalents and other receivables and payables: The carrying amount approximates fair value because of the short maturity of those instruments. Marketable securities: Fair value is based on quoted market prices. Mortgages and Notes receivable: The fair value is estimated based on discounting the future cash flows at a year-end risk adjusted lending rate that the Trust would utilize for loans of similar risk and duration. Mortgages payable and Notes payable: The fair value is estimated based on discounting future cash flows at a year-end adjusted borrowing rate which reflects the risks associated with mortgages and notes of similar risk and duration. NOTE Q - SUBSEQUENT EVENTS Subsequent to July 31, 1998 the Trust purchased an apartment complex containing 278 units and a single tenant retail property containing approximately 34,000 gross leasable square feet. The properties are located in North Carolina and Pennsylvania. The aggregate purchase price for such properties was approximately $14.2 million. On August 11, 1998 the Trustees declared a cash distribution to shareholders of record of the shares of beneficial interest as of September 1, 1998 in the amount of $.375 per share (approximately $22.5 million) payable on September 11, 1998. On August 11, 1998 the Trustees declared a cash distribution to shareholders of record of the Series A Cumulative Preferred Shares as of September 1, 1998 in the amount of $9.75 per share ($.975 per depositary share, approximately $1.5 million) payable on September 15, 1998. On September 25, 1998, New Plan Realty Trust, a Massachusetts business trust (the "Trust"), Excel Realty Trust, Inc., a Maryland corporation ("Excel"), and ERT Merger Sub, Inc., a Maryland corporation and a wholly-owned subsidiary of Excel ("Sub"), voted to accept an Agreement and Plan of Merger dated as of May 14, 1998, as amended as of August 7, 1998, providing for the merger of the Sub with and into the Trust and the Trust surviving as a wholly-owned subsidiary of Excel. Subsequently Excel declared a 20% stock dividend and then issued one share of Excel for each of the Trust's outstanding shares of beneficial interest. Immediately following the consummation of the merger, Excel, which was renamed New Plan Excel Realty Trust, Inc. ("New Plan Excel"), had approximately 88 million common shares outstanding. Holders of the Trust's shares upon consummation of the merger hold approximately 65% of the outstanding common stock of New Plan Excel. The Board of Directors of New Plan Excel consists of the nine (9) current members of the Trust's Board and six (6) members currently on Excel's Board. The dividend policy of New Plan Excel for the first year following the merger is $1.60 per share with anticipated minimum increases of $0.0025 per share per quarter until the current quarterly dividend (expressed as an annual rate) is $1.67 per share. F-21 76 Holders of the Trust's Series A Cumulative Step Up Premium Rate Preferred Shares received an equal amount of Excel's Series D Cumulative Voting Step Up Premium Rate Preferred Stock ("Excel Series D Preferred Stock") with substantially identical terms, except that holders of the Excel Series D Preferred Stock will have the right to vote with the holders of the common stock of New Plan Excel on all matters and for two additional directors of New Plan Excel if the distributions on the Excel Series D Preferred Stock are in arrears for six or more quarterly periods. The merger will, for financial accounting purposes, be accounted for as an acquisition of Excel by New Plan using the purchase method of accounting. The transaction was completed on September 28, 1998. Subsequent to July 31, 1998, the Trust drew down the entire $50 million from its $50 million unsecured line of credit with The Bank of New York, Bank Hapoalim B.M. and Fleet National Bank. F-22 77 NEW PLAN REALTY TRUST AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS (Amounts in Thousands) SCHEDULE II
Additions --------- Balance at Charged to Credited Balance Beginning Costs and to Other at End Description of Period Expenses Revenues Deductions of Period - ----------- --------- -------- -------- ---------- --------- Year Ended July 31, 1998 - ------------- Allowance for doubtful accounts $ 5,581 $ 4,171 -- $ 1,826(1) $ 7,926 Year Ended July 31, 1997 - ------------- Allowance for doubtful accounts $ 3,977 $ 3,283 -- $ 1,679(1) $ 5,581 Year Ended July 31, 1996 - ------------- Allowance for doubtful accounts $ 2,923 $ 1,967 -- $ 913(1) $ 3,976
(1) Trade receivables charged to the reserve. F-23 78 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Apartments ************************** BRECKENRIDGE APARTMENTS 604,487 2,411,462 211,564 BIRMINGHAM AL COURTS AT WILDWOOD 1,119,320 4,477,301 351,854 BIRMINGHAM AL DEVONSHIRE PLACE 1,245,728 4,982,914 1,184,826 BIRMINGHAM AL THE CLUB APARTMENTS 6,145,000 1,709,558 6,838,233 350,580 BIRMINGHAM AL HILLCREST APARTMENTS 1,252,632 251,734 3,325,604 25,855 MOBILE AL KNOLLWOOD APARTMENTS 6,147,218 4,352,001 16,926,403 28,449 MOBILE AL TS 4,625,000 1,971,014 7,897,056 138,225 MOBILE AL MAISON IMPERIAL APTS 1,750,000 672,368 2,702,471 55,389 MOBILE AL PLANTATION APARTMENTS 1,000,000 410,866 1,653,465 26,803 MOBILE AL MAYFAIR APARTMENTS 240,000 962,217 490,342 DOVER DE RODNEY APARTMENTS 769,188 1,612,614 1,272,052 DOVER DE CHARTER PT. APARTMENTS 5,373,859 1,501,146 9,049,327 17,437 ALTAMONTE SPRINGS FL LAKE PARK APARTMENTS 833,000 1,822,039 2,650,479 LAKE PARK FL
COLUMN A COLUMN E COLUMN F COLUMN G - --------- ------------------------------------ ------------ ---------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Building & Accumulated Date of Description Land Improvements Total(1) Depreciation Construction - ----------- -------- ------------ ------------ ------------ ------------ Apartments ************************* BRECKENRIDGE APARTMENTS 604,487 2,623,026 3,227,513 447,169 1979 BIRMINGHAM AL COURTS AT WILDWOOD 1,119,320 4,829,155 5,948,475 652,608 1969 BIRMINGHAM AL DEVONSHIRE PLACE 1,245,728 6,167,740 7,413,468 1,029,021 1971 BIRMINGHAM AL THE CLUB APARTMENTS 1,709,558 7,188,813 8,898,371 599,178 1969-1974 BIRMINGHAM AL HILLCREST APARTMENTS 251,734 3,351,459 3,603,193 88,244 1977 MOBILE AL KNOLLWOOD APARTMENTS 4,352,001 16,954,852 21,306,853 482,144 1978-1982 MOBILE AL TS 1,971,014 8,035,281 10,006,295 399,180 1963,71-73 MOBILE AL MAISON IMPERIAL APTS 672,368 2,757,860 3,430,228 139,584 1969-1973 MOBILE AL PLANTATION APARTMENTS 410,866 1,680,268 2,091,134 88,716 1977 MOBILE AL MAYFAIR APARTMENTS 240,000 1,452,559 1,692,559 749,911 1971 DOVER DE RODNEY APARTMENTS 769,188 2,884,666 3,653,854 2,326,928 1963-1965 DOVER DE CHARTER PT. APARTMENTS 1,501,146 9,066,764 10,567,910 66,946 1973 ALTAMONTE SPRINGS FL LAKE PARK APARTMENTS 833,000 4,472,518 5,305,518 2,417,266 1965 LAKE PARK FL
COLUMN A COLUMN H COLUMN I - --------- -------- -------- Life on Which Depreciated Date in Latest Description Acquired Income Stmt. - ----------- -------- ------------- Apartments ************************* BRECKENRIDGE APARTMENTS Feb 92 40 Years BIRMINGHAM AL COURTS AT WILDWOOD Jul 93 40 Years BIRMINGHAM AL DEVONSHIRE PLACE Feb 92 40 Years BIRMINGHAM AL THE CLUB APARTMENTS May 95 40 Years BIRMINGHAM AL HILLCREST APARTMENTS Jun 97 40 Years MOBILE AL KNOLLWOOD APARTMENTS May 97 40 Years MOBILE AL TS Jul 96 40 Years MOBILE AL MAISON IMPERIAL APTS Jul 96 40 Years MOBILE AL PLANTATION APARTMENTS Jul 96 40 Years MOBILE AL MAYFAIR APARTMENTS Jan 81 40 Years DOVER DE RODNEY APARTMENTS Jan 69 40 Years DOVER DE CHARTER PT. APARTMENTS Apr 98 40 Years ALTAMONTE SPRINGS FL LAKE PARK APARTMENTS Feb 76 40 Years LAKE PARK FL
F-24 79 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Apartments ************************** CAMBRIDGE APARTMENTS 878,593 3,514,373 72,464 ATHENS GA TARA APARTMENTS 3,434,946 1,192,545 4,792,179 103,605 ATHENS GA REGENCY CLUB APARTMENTS 1,179,910 4,719,639 201,407 EVANSVILLE IN FOREST HILLS APARTMENTS 714,761 8,197,499 54,908 INDIANAPOLIS IN HAWTHORNE HEIGHTS APTS 1,669,304 6,698,215 248,741 INDIANAPOLIS IN JAMESTOWN APARTMENTS 518,646 2,075,236 721,454 LEXINGTON KY SADDLEBROOK APARTMENTS 1,939,164 7,756,655 389,580 LEXINGTON KY CHARLESTOWN @ 1,306,230 5,231,914 345,503 DOUGLASS HILLS LOUISVILLE KY LA FONTENAY APARTMENTS 1,176,550 4,706,200 809,838 LOUISVILLE KY POPLAR LEVEL APARTMENTS 284,793 1,139,174 108,346 LOUISVILLE KY RIVERCHASE APARTMENTS 807,302 3,229,206 63,025 NEWPORT KY FORESTWOOD APARTMENTS 2,070,811 8,283,242 127,884 BATON ROUGE LA SHERWOOD ACRES APARTMENTS 3,906,900 15,627,597 100,352 BATON ROUGE LA
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Apartments ************************** CAMBRIDGE APARTMENTS 878,593 3,586,837 4,465,430 204,009 1972,1982 May 96 40 Years ATHENS GA TARA APARTMENTS 1,192,545 4,895,784 6,088,329 266,884 1970 Jun 96 40 Years ATHENS GA REGENCY CLUB APARTMENTS 1,179,910 4,921,046 6,100,956 221,172 1980 Sep 96 40 Years EVANSVILLE IN FOREST HILLS APARTMENTS 714,761 8,252,407 8,967,168 163,617 1974 Oct 97 40 Years INDIANAPOLIS IN HAWTHORNE HEIGHTS APTS 1,669,304 6,946,956 8,616,260 371,847 1965 Jun 96 40 Years INDIANAPOLIS IN JAMESTOWN APARTMENTS 518,646 2,796,690 3,315,336 638,656 1967 Sep 91 40 Years LEXINGTON KY SADDLEBROOK APARTMENTS 1,939,164 8,146,235 10,085,399 705,474 1969 May 95 40 Years LEXINGTON KY CHARLESTOWN @ 1,306,230 5,577,417 6,883,647 712,704 1974 Sep 93 40 Years DOUGLASS HILLS LOUISVILLE KY LA FONTENAY APARTMENTS 1,176,550 5,516,038 6,692,588 890,671 1970 Jul 92 40 Years LOUISVILLE KY POPLAR LEVEL APARTMENTS 284,793 1,247,520 1,532,313 250,136 1974 Jan 91 40 Years LOUISVILLE KY RIVERCHASE APARTMENTS 807,302 3,292,231 4,099,533 152,358 1968 Aug 96 40 Years NEWPORT KY FORESTWOOD APARTMENTS 2,070,811 8,411,126 0,481,937 349,477 1985 Oct 96 40 Years BATON ROUGE LA SHERWOOD ACRES APARTMENTS 3,906,900 15,727,949 9,634,849 677,990 1978-1979 Oct 96 40 Years BATON ROUGE LA
F-25 80 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Apartments ************************** WILLOW BEND LAKE APARTMENTS 2,930,484 11,721,937 76,028 BATON ROUGE LA DEERHORN VILLAGE APARTMENTS 1,292,778 5,171,112 288,935 KANSAS CITY MO CARDINAL WOODS APARTMENTS 1,435,783 5,726,132 33,295 CARY NC MEADOW EAST APARTMENTS 86,407 1,467,282 496,433 POTSDAM NY MOHAWK GARDEN APARTMENTS 163,235 1,135,660 1,678,762 ROME NY NORTHGATE APARTMENTS 7,600,561 1,513,498 9,297,201 COLUMBUS OH SPRING CREEK APARTMENTS 1,455,271 9,082,352 52,091 COLUMBUS OH ARLINGTON VILLAGE 1,065,284 4,269,138 158,123 APARTMENTS FAIRBORN OH CHESTERFIELD APARTMENTS 179,109 1,449,156 367,781 MAUMEE OH EASTGREEN ON COMMONS 6,075,476 1,142,888 7,648,557 23,801 APARTMENTS REYNOLDSBURG OH GOLDCREST APARTMENTS 1,133,355 4,533,416 77,724 SHARONVILLE OH CAMBRIDGE PARK APTS 1,223,582 4,894,326 92,123 UNION TWP-CINN OH GOVERNOUR'S PLACE 626,807 2,507,226 106,187 APARTMENTS HARRISBURG PA
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Apartments ************************** WILLOW BEND LAKE APARTMENTS 2,930,484 11,797,965 14,728,449 484,561 1986 Oct 96 40 Years BATON ROUGE LA DEERHORN VILLAGE APARTMENTS 1,292,778 5,460,047 6,752,825 436,193 1974 Jul 95 40 Years KANSAS CITY MO CARDINAL WOODS APARTMENTS 1,435,783 5,759,427 7,195,210 126,292 1978 Aug 97 40 Years CARY NC MEADOW EAST APARTMENTS 86,407 1,963,715 2,050,122 731,727 1964-1971 Sep 83 40 Years POTSDAM NY MOHAWK GARDEN APARTMENTS 163,235 2,814,422 2,977,657 1,219,879 1947 Nov 85 40 Years ROME NY NORTHGATE APARTMENTS 1,513,498 9,297,201 10,810,699 58,108 1970 Jul 98 40 Years COLUMBUS OH SPRING CREEK APARTMENTS 1,455,271 9,134,443 10,589,714 239,417 1985 Jun 97 40 Years COLUMBUS OH ARLINGTON VILLAGE 1,065,284 4,427,261 5,492,545 452,049 1966 Aug 94 40 Years APARTMENTS FAIRBORN OH CHESTERFIELD APARTMENTS 179,109 1,816,937 1,996,046 336,028 1979-1984 Feb 91 40 Years MAUMEE OH EASTGREEN ON COMMONS 1,142,888 7,672,358 8,815,246 89,830 1971,1982 Jan 98 40 Years APARTMENTS REYNOLDSBURG OH GOLDCREST APARTMENTS 1,133,355 4,611,140 5,744,495 210,758 1968 Aug 96 40 Years SHARONVILLE OH CAMBRIDGE PARK APTS 1,223,582 4,986,449 6,210,031 229,912 1973 Aug 96 40 Years UNION TWP-CINN OH GOVERNOUR'S PLACE 626,807 2,613,413 3,240,220 219,724 1974 Apr 95 40 Years APARTMENTS HARRISBURG PA
F-26 81 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Apartments ************************** HARBOUR LANDING APARTMENTS 1,141,954 4,567,815 146,395 COLUMBIA SC SEDGEFIELD APARTMENTS 1,550,734 6,211,936 231,178 FLORENCE SC TURTLE CREEK APARTMENTS 984,565 3,954,261 50,303 GREENVILLE SC HICKORY LAKE APARTMENTS 1,369,251 5,483,004 758,285 ANTIOCH TN COURTS @ WATERFORD PLACE 9,600,000 2,745,404 10,982,373 168,766 CHATTANOOGA TN ASHFORD PLACE APARTMENTS 1,150,270 4,611,080 631,019 CLARKSVILLE TN CEDAR VILLAGE APARTMENTS 806,355 3,230,420 123,756 CLARKSVILLE TN PADDOCK PLACE APARTMENTS 1,358,400 5,437,602 85,393 CLARKSVILLE TN THE PINES APARTMENTS 918,769 3,679,074 114,819 CLARKSVILLE TN LANDMARK ESTATES 476,624 1,906,284 89,241 APARTMENTS EAST RIDGE TN MILLER CREST APARTMENTS 747,155 3,025,619 69,084 JOHNSON CITY TN CEDAR BLUFF APARTMENTS 1,312,383 5,269,532 87,328 KNOXVILLE TN COUNTRY PLACE APARTMENTS 1,896,828 7,587,313 97,521 NASHVILLE TN
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Apartments ************************** HARBOUR LANDING APARTMENTS 1,141,954 4,714,210 5,856,164 354,188 1974 Sep 95 40 Years COLUMBIA SC SEDGEFIELD APARTMENTS 1,550,734 6,443,114 7,993,848 673,188 1972,74,79 Jul 94 40 Years FLORENCE SC TURTLE CREEK APARTMENTS 984,565 4,004,564 4,989,129 216,688 1976 Jun 96 40 Years GREENVILLE SC HICKORY LAKE APARTMENTS 1,369,251 6,241,289 7,610,540 774,150 1974 Dec 93 40 Years ANTIOCH TN COURTS @ WATERFORD PLACE 2,745,404 11,151,139 13,896,543 459,186 1988,89 Dec 96 40 Years CHATTANOOGA TN ASHFORD PLACE APARTMENTS 1,150,270 5,242,099 6,392,369 673,452 1972-1974 Oct 93 40 Years CLARKSVILLE TN CEDAR VILLAGE APARTMENTS 806,355 3,354,176 4,160,531 349,428 1982 Jul 94 40 Years CLARKSVILLE TN PADDOCK PLACE APARTMENTS 1,358,400 5,522,995 6,881,395 561,890 1989 Jul 94 40 Years CLARKSVILLE TN THE PINES APARTMENTS 918,769 3,793,893 4,712,662 393,198 1986 Jul 94 40 Years CLARKSVILLE TN LANDMARK ESTATES 476,624 1,995,525 2,472,149 94,406 1971 Aug 96 40 Years APARTMENTS EAST RIDGE TN MILLER CREST APARTMENTS 747,155 3,094,703 3,841,858 168,372 1973 Jun 96 40 Years JOHNSON CITY TN CEDAR BLUFF APARTMENTS 1,312,383 5,356,860 6,669,243 299,497 1980 May 96 40 Years KNOXVILLE TN COUNTRY PLACE APARTMENTS 1,896,828 7,684,834 9,581,662 447,411 1979 Apr 96 40 Years NASHVILLE TN
F-27 82 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Apartments ************************** WOODBRIDGE APARTMENTS 1,594,214 6,376,854 88,123 NASHVILLE TN Factory Outlets ************************** FACTORY MERCHANTS BARSTOW 9,577,791 5,730,337 22,936,349 12,941,013 BARSTOW CA ST AUGUSTINE OUTLET CENTER 55,716 4,488,742 14,426,139 10,139,135 ST AUGUSTINE FL FACTORY MERCHANTS BRANSON 17,669 22,312,120 11,777,940 BRANSON MO FACTORY OUTLET VILLAGE 6,978,714 27,259,675 7,538,916 OSAGE BEACH OSAGE BEACH MO SIX FLAGS FACTORY OUTLET 889,214 147,452 22,942,336 JACKSON NJ FACTORY MERCHANTS 411,023 1,644,017 1,004,759 FT CHISWELL MAX MEADOWS VA Miscellaneous ************************** PIZZA HUT - PAD 40,065 225,958 GREENVILLE NC HARDEES - PAD 400,000 HANOVER PA PIZZA HUT - PAD 427,500 HARRISONBURG VA
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Apartments ************************** WOODBRIDGE APARTMENTS 1,594,214 6,464,977 8,059,191 296,054 1980 Aug 96 40 Years NASHVILLE TN Factory Outlets ************************** FACTORY MERCHANTS BARSTOW 5,730,337 35,877,362 41,607,699 4,340,567 1989 Nov 93 40 Years BARSTOW CA ST AUGUSTINE OUTLET CENTER 4,488,742 24,565,274 29,054,016 4,026,008 1991 Mar 92 40 Years ST AUGUSTINE FL FACTORY MERCHANTS BRANSON 17,669 34,090,060 34,107,729 3,987,908 1988 Nov 93 40 Years BRANSON MO FACTORY OUTLET VILLAGE 6,978,714 34,798,591 41,777,305 4,857,237 1987 Jan 93 40 Years OSAGE BEACH OSAGE BEACH MO SIX FLAGS FACTORY OUTLET 889,214 23,089,788 23,979,002 738,180 1997 Apr 97 40 Years JACKSON NJ FACTORY MERCHANTS 411,023 2,648,776 3,059,799 901,677 1989 Nov 93 40 Years FT CHISWELL MAX MEADOWS VA Miscellaneous ************************** PIZZA HUT - PAD 40,065 225,958 266,023 90,362 1973 May 86 35 Years GREENVILLE NC HARDEES - PAD 400,000 400,000 10,417 1971 Jul 97 35 Years HANOVER PA PIZZA HUT - PAD 427,500 427,500 24,429 1969 Jul 96 35 Years HARRISONBURG VA
F-28 83 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Office Building ************************** INSTITUTE FOR DEFENSE ANALYSIS 1,389,460 PRINCETON NJ Shopping Centers ************************** CLOVERDALE VILLAGE 634,152 2,536,606 7,304 FLORENCE AL DOVERAMA @ RODNEY VILLAGE 50,755 311,781 DOVER DE RODNEY VILLAGE 1,202,551 2,082,918 2,295,395 DOVER DE REGENCY PARK SHOPPING CENTER 3,888,425 15,553,501 36,703 JACKSONVILLE FL SOUTHGATE SHOPPING CENTER 4,253,341 3,981,290 1,950 NEW PORT RICHIE FL PRESIDENTIAL PLAZA 1,312,956 2,456,917 113,551 NORTH LAUDERDALE FL PRESIDENTIAL PLAZA WEST 437,485 812,473 3,377 NORTH LAUDERDALE FL COLONIAL MARKETPLACE 4,171,327 2,524,647 3,504,446 ORLANDO FL RIVERWOOD SHOPPING CENTER 2,243,023 1,500,580 8,960 PORT ORANGE FL SEMINOLE PLAZA 2,128,480 2,215,356 SEMINOLE FL RUTLAND PLAZA 1,443,294 5,773,175 88,646 ST PETERSBURG FL
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Office Building ************************** INSTITUTE FOR DEFENSE ANALYSIS 1,389,460 1,389,460 693,669 1982 May 74 35 Years PRINCETON NJ Shopping Centers ************************** CLOVERDALE VILLAGE 634,152 2,543,910 3,178,062 241,734 1986 Oct 94 40 Years FLORENCE AL DOVERAMA @ RODNEY VILLAGE 50,755 311,781 362,536 75,700 1969 Oct 88 40 Years DOVER DE RODNEY VILLAGE 1,202,551 4,378,313 5,580,864 3,237,674 1959 Jan 69 40 Years DOVER DE REGENCY PARK SHOPPING CENTER 3,888,425 15,590,204 19,478,629 411,152 1985 Jun 97 40 Years JACKSONVILLE FL SOUTHGATE SHOPPING CENTER 4,253,341 3,983,240 8,236,581 78,998 1966 Aug 97 40 Years NEW PORT RICHIE FL PRESIDENTIAL PLAZA 1,312,956 2,570,468 3,883,424 82,651 1977 Apr 97 40 Years NORTH LAUDERDALE FL PRESIDENTIAL PLAZA WEST 437,485 815,850 1,253,335 26,370 1977 Apr 97 40 Years NORTH LAUDERDALE FL COLONIAL MARKETPLACE 2,524,647 3,504,446 6,029,093 25,553 1979,86 Apr 98 40 Years ORLANDO FL RIVERWOOD SHOPPING CENTER 2,243,023 1,509,540 3,752,563 32,791 1984,1996 Sep 97 40 Years PORT ORANGE FL SEMINOLE PLAZA 2,128,480 2,215,356 4,343,836 13,846 1964 Jun 98 40 Years SEMINOLE FL RUTLAND PLAZA 1,443,294 5,861,821 7,305,115 249,846 1964 Nov 96 40 Years ST PETERSBURG FL
F-29 84 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************ ALBANY PLAZA 696,447 2,799,786 122,783 ALBANY GA SOUTHGATE PLAZA - ALBANY 231,517 970,811 102,591 ALBANY GA EASTGATE PLAZA - AMERICUS 221,637 1,036,331 103,054 AMERICUS GA PERLIS PLAZA 774,966 5,301,644 561,117 AMERICUS GA ROGERS PLAZA 291,014 688,590 110,593 ASHBURN GA SWEETWATER VILLAGE 707,938 2,831,750 13,405 AUSTELL GA CEDAR PLAZA 928,302 3,713,207 49,995 CEDARTOWN GA CEDARTOWN SHOPPING CENTER 745,006 3,266,424 84,289 CEDARTOWN GA CORDELE SQUARE 864,335 3,457,337 399,943 CORDELE GA MR B'S 166,047 154,140 7,880 CORDELE GA SOUTHGATE PLAZA - CORDELE 202,682 958,998 74,318 CORDELE GA HABERSHAM VILLAGE 1,301,643 4,340,422 725,184 CORNELIA GA MIDWAY VILLAGE SHOPPING CENTER 1,553,580 2,887,506 31,108 DOUGLASVILLE GA
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************ ALBANY PLAZA 696,447 2,922,569 3,619,016 304,353 1968 May 94 40 Years ALBANY GA SOUTHGATE PLAZA - ALBANY 231,517 1,073,402 1,304,919 198,323 1969 Jul 90 40 Years ALBANY GA EASTGATE PLAZA - AMERICUS 221,637 1,139,385 1,361,022 211,408 1980 Jul 90 40 Years AMERICUS GA PERLIS PLAZA 774,966 5,862,761 6,637,727 1,174,057 1972 Jul 90 40 Years AMERICUS GA ROGERS PLAZA 291,014 799,183 1,090,197 177,894 1974 Jul 90 40 Years ASHBURN GA SWEETWATER VILLAGE 707,938 2,845,155 3,553,093 269,237 1985 Oct 94 40 Years AUSTELL GA CEDAR PLAZA 928,302 3,763,202 4,691,504 355,948 1994 Oct 94 40 Years CEDARTOWN GA CEDARTOWN SHOPPING CENTER 745,006 3,350,713 4,095,719 300,530 1989 Jan 95 40 Years CEDARTOWN GA CORDELE SQUARE 864,335 3,857,280 4,721,615 791,121 1968 Jul 90 40 Years CORDELE GA MR B'S 166,047 162,020 328,067 32,548 1968 Jul 90 40 Years CORDELE GA SOUTHGATE PLAZA - CORDELE 202,682 1,033,316 1,235,998 196,630 1969 Jul 90 40 Years CORDELE GA HABERSHAM VILLAGE 1,301,643 5,065,606 6,367,249 31,598 1985 May 92 40 Years CORNELIA GA MIDWAY VILLAGE SHOPPING CENTER 1,553,580 2,918,614 4,472,194 81,590 1989 May 97 40 Years DOUGLASVILLE GA
F-30 85 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** WESTGATE - DUBLIN 699,174 5,834,809 141,238 DUBLIN GA NEW CHASTAIN CORNERS SHOPPING CENTER 2,457,446 5,741,641 37,736 MARIETTA GA VILLAGE AT SOUTHLAKE 1,754,798 3,056,077 MORROW GA CREEKWOOD SHOPPING CENTER 1,160,203 3,482,609 (1) REX GA EISENHOWER SQUARE SHOPPING CENTER 1,029,500 4,117,700 80,445 SAVANNAH GA VICTORY SQUARE 1,206,181 4,824,725 117,844 SAVANNAH GA TIFT-TOWN 271,444 1,325,238 271,359 TIFTON GA WESTGATE - TIFTON 156,269 304,704 963 TIFTON GA HAYMARKET MALL 1,230,252 5,031,799 119,315 DES MOINES IA HAYMARKET SQUARE 2,056,172 8,224,688 373,934 DES MOINES IA SOUTHFIELD PLAZA SHOPPING CENTER 3,188,496 3,897,167 2,164,858 BRIDGEVIEW IL WESTRIDGE COURT SHOPPING CENTER 9,815,696 39,261,783 363,493 NAPERVILLE IL TINLEY PARK PLAZA 2,607,702 10,430,808 266,686 TINLEY PARK IL
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** WESTGATE - DUBLIN 699,174 5,976,047 6,675,221 1,185,069 1974 Jul 90 40 Years DUBLIN GA NEW CHASTAIN CORNERS SHOPPING CENTER 2,457,446 5,779,377 8,236,823 149,371 1990 Jul 97 40 Years MARIETTA GA VILLAGE AT SOUTHLAKE 1,754,798 3,056,077 4,810,875 22,284 1983 Apr 98 40 Years MORROW GA CREEKWOOD SHOPPING CENTER 1,160,203 3,482,608 4,642,811 97,865 1990 May 97 40 Years REX GA EISENHOWER SQUARE SHOPPING CENTER 1,029,500 4,198,145 5,227,645 109,996 1985 Jul 97 40 Years SAVANNAH GA VICTORY SQUARE 1,206,181 4,942,569 6,148,750 742,729 1986 Jul 92 40 Years SAVANNAH GA TIFT-TOWN 271,444 1,596,597 1,868,041 300,592 1965 Jul 90 40 Years TIFTON GA WESTGATE - TIFTON 156,269 305,667 461,936 61,303 1980 Jul 90 40 Years TIFTON GA HAYMARKET MALL 1,230,252 5,151,114 6,381,366 406,404 1968-1979 May 95 40 Years DES MOINES IA HAYMARKET SQUARE 2,056,172 8,598,622 10,654,794 682,356 1971-1979 May 95 40 Years DES MOINES IA SOUTHFIELD PLAZA SHOPPING CENTER 3,188,496 6,062,025 9,250,521 258,889 1958,72 Dec 96 40 Years BRIDGEVIEW IL WESTRIDGE COURT SHOPPING CENTER 9,815,696 39,625,276 9,440,972 1,032,619 1990 Jul 97 40 Years NAPERVILLE IL TINLEY PARK PLAZA 2,607,702 10,697,494 13,305,196 792,934 1973 Sep 95 40 Years TINLEY PARK IL
F-31 86 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** COLUMBUS CENTER 1,196,269 3,608,315 2,491,668 COLUMBUS IN JASPER MANOR 1,319,937 7,110,063 18,588 JASPER IN TOWN FAIR SHOPPING CENTER 1,104,876 3,759,503 10,437 PRINCETON IN WABASH CROSSING 1,614,878 6,470,511 27,744 WABASH IN JACKSON VILLAGE 284,815 3,115,586 589,956 JACKSON KY J*TOWN CENTER 1,331,074 4,121,997 616,521 JEFFERSONTOWN KY NEW LOUISA PLAZA 469,014 1,998,752 161,683 LOUISA KY PICCADILLY SQUARE 355,000 1,588,409 323,428 LOUISVILLE KY EASTGATE SHOPPING CENTER 1,945,679 7,792,717 703,838 MIDDLETOWN KY LIBERTY PLAZA 2,075,809 8,303,237 160,652 RANDALLSTOWN MD SHOPPING CENTER - SALISBURY 312,650 1,833,330 86,550 SALISBURY MD MAPLE VILLAGE SHOPPING CENTER 1,625,580 6,514,322 1,336,221 ANN ARBOR MI FARMINGTON CROSSROADS 1,092,200 4,368,800 62,479 FARMINGTON MI
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** COLUMBUS CENTER 1,196,269 6,099,983 7,296,252 1,655,146 1964 Dec 88 40 Years COLUMBUS IN JASPER MANOR 1,319,937 7,128,651 8,448,588 1,152,463 1990 Feb 92 40 Years JASPER IN TOWN FAIR SHOPPING CENTER 1,104,876 3,769,940 4,874,816 513,236 1991 Feb 93 40 Years PRINCETON IN WABASH CROSSING 1,614,878 6,498,255 8,113,133 751,676 1988 Dec 93 40 Years WABASH IN JACKSON VILLAGE 284,815 3,705,542 3,990,357 813,761 1983 Dec 88 40 Years JACKSON KY J*TOWN CENTER 1,331,074 4,738,518 6,069,592 1,152,789 1959 Oct 88 40 Years JEFFERSONTOWN KY NEW LOUISA PLAZA 469,014 2,160,435 2,629,449 688,335 1978 Feb 88 40 Years LOUISA KY PICCADILLY SQUARE 355,000 1,911,837 2,266,837 447,214 1973 Apr 89 40 Years LOUISVILLE KY EASTGATE SHOPPING CENTER 1,945,679 8,496,555 10,442,234 1,014,613 1987 Nov 93 40 Years MIDDLETOWN KY LIBERTY PLAZA 2,075,809 8,463,889 10,539,698 684,623 1962 May 95 40 Years RANDALLSTOWN MD SHOPPING CENTER - SALISBURY 312,650 1,919,880 2,232,530 654,286 1973 May 86 35 Years SALISBURY MD MAPLE VILLAGE SHOPPING CENTER 1,625,580 7,850,543 9,476,123 707,290 1965 Oct 94 40 Years ANN ARBOR MI FARMINGTON CROSSROADS 1,092,200 4,431,279 5,523,479 283,860 1986 Dec 95 40 Years FARMINGTON MI
F-32 87 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** DELTA CENTER 2,405,200 9,620,800 122,447 LANSING MI HAMPTON VILLAGE CENTRE 19,089,566 8,638,500 34,541,500 198,445 ROCHESTER HILLS MI FASHION CORNERS 2,244,800 8,799,200 9,900 SAGINAW MI HALL ROAD CROSSING 2,595,500 10,382,000 229,950 SHELBY MI SOUTHFIELD PLAZA 2,052,995 8,211,980 20,404 SOUTHFIELD MI DELCO PLAZA 1,277,504 5,109,367 46,815 STERLING HEIGHTS MI WASHTENAW FOUNTAIN PLAZA 1,530,281 6,121,123 287,614 YPSILANTI MI SHOPPING CENTER - GOLDSBORO 181,998 1,014,432 55,222 GOLDSBORO NC SHOPPING CENTER - WILSON 315,000 1,780,370 71,456 WILSON NC LAUREL SQUARE 3,261,701 9,283,302 604,786 BRICKTOWN NJ HAMILTON PLAZA 1,124,415 4,513,658 218,285 HAMILTON NJ BENNETTS MILLS PLAZA 1,794,122 6,399,888 68,222 JACKSON NJ MIDDLETOWN PLAZA 1,204,829 1,479,487 3,634,941 MIDDLETOWN NJ
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** DELTA CENTER 2,405,200 9,743,247 12,148,447 623,713 1985 Dec 95 40 Years LANSING MI HAMPTON VILLAGE CENTRE 8,638,500 34,739,945 43,378,445 2,220,440 1990 Dec 95 40 Years ROCHESTER HILLS MI FASHION CORNERS 2,244,800 8,809,100 11,053,900 562,888 1986 Dec 95 40 Years SAGINAW MI HALL ROAD CROSSING 2,595,500 10,611,950 13,207,450 690,256 1985 Dec 95 40 Years SHELBY MI SOUTHFIELD PLAZA 2,052,995 8,232,384 10,285,379 77,742 1969-70 Feb 98 40 Years SOUTHFIELD MI DELCO PLAZA 1,277,504 5,156,182 6,433,686 208,876 1970,73 Nov 96 40 Years STERLING HEIGHTS MI WASHTENAW FOUNTAIN PLAZA 1,530,281 6,408,737 7,939,018 984,296 1989 Oct 92 40 Years YPSILANTI MI SHOPPING CENTER - GOLDSBORO 181,998 1,069,654 1,251,652 361,052 1973 May 86 35 Years GOLDSBORO NC SHOPPING CENTER - WILSON 315,000 1,851,826 2,166,826 631,227 1973 May 86 35 Years WILSON NC LAUREL SQUARE 3,261,701 9,888,088 13,149,789 1,534,876 1973 Jul 92 40 Years BRICKTOWN NJ HAMILTON PLAZA 1,124,415 4,731,943 5,856,358 518,015 1972 May 94 40 Years HAMILTON NJ BENNETTS MILLS PLAZA 1,794,122 6,468,110 8,262,232 623,522 1988 Sep 94 40 Years JACKSON NJ MIDDLETOWN PLAZA 1,204,829 5,114,428 6,319,257 1,907,719 1972 Jan 75 40 Years MIDDLETOWN NJ
F-33 88 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers *********************** TINTON FALLS PLAZA 1,884,325 6,308,392 41,275 TINTON FALLS NJ RENAISSANCE CENTER EAST 2,543,856 10,175,427 185,340 LAS VEGAS NV UNIVERSITY MALL 115,079 1,009,902 801,101 CANTON NY CORTLANDVILLE 236,846 1,439,000 430,013 CORTLAND NY KMART PLAZA 942,257 3,769,027 246,904 DEWITT NY D & F PLAZA 730,512 2,156,542 1,245,703 DUNKIRK NY SHOPPING CENTER - ELMIRA 110,116 891,205 ELMIRA NY PYRAMID MALL 2,175,221 8,700,884 130,112 GENEVA NY SHOPPING CENTER - GLOVERSVILLE 139,429 524,517 104,564 GLOVERSVILLE NY MCKINLEY PLAZA 1,246,680 4,986,720 93,023 HAMBURG NY CAYUGA PLAZA 1,397,708 5,591,832 504,127 ITHACA NY SHOPS @ SENECA MALL 1,545,838 6,183,353 584,685 LIVERPOOL NY TRANSIT ROAD PLAZA 424,634 1,698,537 330,069 LOCKPORT NY
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** TINTON FALLS PLAZA 1,884,325 6,349,667 8,233,992 72,686 1953 Jan 98 40 Years TINTON FALLS NJ RENAISSANCE CENTER EAST 2,543,856 10,360,767 12,904,623 468,255 1981 Oct 96 40 Years LAS VEGAS NV UNIVERSITY MALL 115,079 1,811,003 1,926,082 953,606 1967 Jan 76 40 Years CANTON NY CORTLANDVILLE 236,846 1,869,013 2,105,859 465,674 1984 Aug 87 35 Years CORTLAND NY KMART PLAZA 942,257 4,015,931 4,958,188 487,018 1970 Aug 93 40 Years DEWITT NY D & F PLAZA 730,512 3,402,245 4,132,757 1,043,021 1967 Jan 86 40 Years DUNKIRK NY SHOPPING CENTER - ELMIRA 110,116 891,205 1,001,321 210,733 1976 Feb 89 40 Years ELMIRA NY PYRAMID MALL 2,175,221 8,830,996 11,006,217 1,094,327 1973 Aug 93 40 Years GENEVA NY SHOPPING CENTER - GLOVERSVILLE 139,429 629,081 768,510 147,535 1974 Dec 88 40 Years GLOVERSVILLE NY MCKINLEY PLAZA 1,246,680 5,079,743 6,326,423 838,142 1991 Jun 92 40 Years HAMBURG NY CAYUGA PLAZA 1,397,708 6,095,959 7,493,667 1,388,461 1969 May 89 40 Years ITHACA NY SHOPS @ SENECA MALL 1,545,838 6,768,038 8,313,876 804,360 1971 Aug 93 40 Years LIVERPOOL NY TRANSIT ROAD PLAZA 424,634 2,028,606 2,453,240 237,853 1971 Aug 93 40 Years LOCKPORT NY
F-34 89 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** SHOPPING CENTER - MARCY 400,000 2,231,817 94,207 MARCY NY WALLKILL PLAZA 2,445,200 8,580,800 148,852 MIDDLETOWN NY MONROE SHOPRITE PLAZA 1,026,477 8,642,364 70,606 MONROE NY ROCKLAND PLAZA 3,990,842 3,570,410 5,244,968 NANUET NY SOUTH PLAZA 508,013 1,051,638 1,583,556 NORWICH NY WESTGATE PLAZA - ONEONTA 142,821 1,192,103 261,650 ONEONTA NY OSWEGO PLAZA 250,000 1,168,027 2,544,798 OSWEGO NY MOHAWK ACRES 241,606 1,268,890 1,537,271 ROME NY MONTGOMERY WARD 93,341 483,405 231,437 ROME NY PRICE CHOPPER PLAZA 933,792 3,735,170 ROME NY WESTGATE MANOR PLAZA - ROME 211,711 391,982 790,519 ROME NY NORTHLAND 16,182 255,557 823,737 WATERTOWN NY HARBOR PLAZA 388,997 1,456,108 253,099 ASHTABULA OH
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** SHOPPING CENTER - MARCY 400,000 2,326,024 2,726,024 811,560 1971 May 86 35 Years MARCY NY WALLKILL PLAZA 2,445,200 8,729,652 11,174,852 555,587 1986 Dec 95 40 Years MIDDLETOWN NY MONROE SHOPRITE PLAZA 1,026,477 8,712,970 9,739,447 171,736 1972 Aug 97 40 Years MONROE NY ROCKLAND PLAZA 3,990,842 8,815,378 12,806,220 3,447,765 1963 Jan 83 40 Years NANUET NY SOUTH PLAZA 508,013 2,635,194 3,143,207 1,082,582 1967 Apr 83 40 Years NORWICH NY WESTGATE PLAZA - ONEONTA 142,821 1,453,753 1,596,574 566,351 1967 Jan 84 40 Years ONEONTA NY OSWEGO PLAZA 250,000 3,712,825 3,962,825 1,400,581 1966 Jan 77 40 Years OSWEGO NY MOHAWK ACRES 241,606 2,806,161 3,047,767 906,679 1965 Feb 84 40 Years ROME NY MONTGOMERY WARD 93,341 714,842 808,183 270,990 1965 Jan 84 40 Years ROME NY PRICE CHOPPER PLAZA 933,792 3,735,170 4,668,962 463,344 1988 Aug 93 40 Years ROME NY WESTGATE MANOR PLAZA - ROME 211,711 1,182,501 1,394,212 275,046 1961 Jan 86 40 Years ROME NY NORTHLAND 16,182 1,079,294 1,095,476 331,476 1962 Jan 73 40 Years WATERTOWN NY HARBOR PLAZA 388,997 1,709,207 2,098,204 335,491 1988 Feb 91 40 Years ASHTABULA OH
F-35 90 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** BELPRE PLAZA 2,066,121 140,189 BELPRE OH SOUTHWOOD PLAZA 707,073 1,537,519 856,497 BOWLING GREEN OH BRENTWOOD PLAZA 2,050,969 8,222,875 524,143 CINCINNATI OH DELHI SHOPPING CENTER 2,300,029 9,218,117 9,985 CINCINNATI OH WESTERN VILLAGE SHOPPING CNTR 1,321,484 5,300,935 117,335 CINCINNATI OH CROWN POINT SHOPPING CNTR 7,870,225 2,881,681 7,958,319 COLUMBUS OH SOUTH TOWNE CENTRE 4,737,368 9,636,943 1,550,056 DAYTON OH HERITAGE SQUARE 1,749,182 7,011,927 59,707 DOVER OH MIDWAY CROSSING 1,944,200 7,776,800 123,075 ELYRIA OH FAIRFIELD MALL 1,287,649 1,685,919 101,962 FAIRFIELD OH SILVER BRIDGE PLAZA 919,022 3,197,673 1,490,228 GALLIPOLIS OH SHOPPING CENTER - GENOA 96,001 1,016,349 GENOA OH PARKWAY PLAZA 950,667 2,069,921 448,155 MAUMEE OH
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** BELPRE PLAZA 2,206,310 2,206,310 583,209 1969 Jun 88 40 Years BELPRE OH SOUTHWOOD PLAZA 707,073 2,394,016 3,101,089 712,715 1961 May 90 40 Years BOWLING GREEN OH BRENTWOOD PLAZA 2,050,969 8,747,018 10,797,987 892,799 1957 May 94 40 Years CINCINNATI OH DELHI SHOPPING CENTER 2,300,029 9,228,102 11,528,131 490,533 1973,85,87 May 96 40 Years CINCINNATI OH WESTERN VILLAGE SHOPPING CNTR 1,321,484 5,418,270 6,739,754 567,937 1960 May 94 40 Years CINCINNATI OH CROWN POINT SHOPPING CNTR 2,881,681 7,958,319 10,840,000 49,739 1980-85,97 Jul 98 40 Years COLUMBUS OH SOUTH TOWNE CENTRE 4,737,368 11,186,999 15,924,367 1,900,897 1972 Mar 92 40 Years DAYTON OH HERITAGE SQUARE 1,749,182 7,071,634 8,820,816 911,345 1959 Aug 93 40 Years DOVER OH MIDWAY CROSSING 1,944,200 7,899,875 9,844,075 498,379 1986 Dec 95 40 Years ELYRIA OH FAIRFIELD MALL 1,287,649 1,787,881 3,075,530 372,052 1978 May 90 40 Years FAIRFIELD OH SILVER BRIDGE PLAZA 919,022 4,687,901 5,606,923 1,736,663 1972 Dec 86 40 Years GALLIPOLIS OH SHOPPING CENTER - GENOA 96,001 1,016,349 1,112,350 187,568 1987 Mar 91 40 Years GENOA OH PARKWAY PLAZA 950,667 2,518,076 3,468,743 537,498 1955 Sep 89 40 Years MAUMEE OH
F-36 91 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Apartments Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** NEW BOSTON SHOPPING CENTER 2,102,371 9,176,918 127,231 NEW BOSTON OH MARKET PLACE 597,923 3,738,164 403,895 PIQUA OH BRICE PARK SHOPPING CENTER 5,273,913 4,854,414 10,204,698 5,545 REYNOLDSBURG OH CENTRAL AVE MARKET PLACE 1,046,480 1,769,207 381,861 TOLEDO OH GREENTREE SHOPPING CENTER 6,819,608 3,379,200 6,860,800 UPPER ARLINGTON OH BETHEL PARK PLAZA 868,039 9,933,094 867,622 BETHEL PARK PA DILLSBURG SHOPPING CENTER 1,166,376 4,665,505 DILLSBURG PA NEW GARDEN SHOPPING CENTER 912,130 3,161,495 7,651 KENNETT SQUARE PA STONEMILL PLAZA 1,407,975 5,650,901 58,389 LANCASTER PA CROSSROADS PLAZA 384,882 1,040,668 368,438 MT. PLEASANT PA IVYRIDGE SHOPPING CENTER 1,504,080 6,026,320 733,697 PHILADELPHIA PA ROOSEVELT MALL ANNEX 159,703 91,798 1,074,786 PHILADELPHIA PA ROOSEVELT MALL NE 2,602,635 6,466,386 PHILADELPHIA PA
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** NEW BOSTON SHOPPING CENTER 2,102,371 9,304,149 11,406,520 1,264,283 1991 Feb 93 40 Years NEW BOSTON OH MARKET PLACE 597,923 4,142,059 4,739,982 789,221 1972 Nov 91 40 Years PIQUA OH BRICE PARK SHOPPING CENTER 4,854,414 10,210,243 15,064,657 74,409 1989-92 Mar 98 40 Years REYNOLDSBURG OH CENTRAL AVE MARKET PLACE 1,046,480 2,151,068 3,197,548 411,880 1968 Aug 90 40 Years TOLEDO OH GREENTREE SHOPPING CENTER 3,379,200 6,860,800 10,240,000 42,880 1974,80,91 Jul 98 40 Years UPPER ARLINGTON OH BETHEL PARK PLAZA 868,039 10,800,716 11,668,755 319,815 1965 May 97 40 Years BETHEL PARK PA DILLSBURG SHOPPING CENTER 1,166,376 4,665,505 5,831,881 208,924 1994 Oct 96 40 Years DILLSBURG PA NEW GARDEN SHOPPING CENTER 912,130 3,169,146 4,081,276 96,886 1979 Apr 97 40 Years KENNETT SQUARE PA STONEMILL PLAZA 1,407,975 5,709,290 7,117,265 646,666 1988 Jan 94 40 Years LANCASTER PA CROSSROADS PLAZA 384,882 1,409,106 1,793,988 330,317 1975 Nov 88 40 Years MT. PLEASANT PA IVYRIDGE SHOPPING CENTER 1,504,080 6,760,017 8,264,097 459,483 1963 Aug 95 40 Years PHILADELPHIA PA ROOSEVELT MALL ANNEX 159,703 1,166,584 1,326,287 602,409 1958 Apr 74 40 Years PHILADELPHIA PA ROOSEVELT MALL NE 9,069,021 9,069,021 4,654,054 1964 Jan 64 40 Years PHILADELPHIA PA
F-37 92 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Apartments Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************** STRAWBRIDGE'S 605,607 3,923,050 PHILADELPHIA PA ST MARY'S PLAZA 977,711 3,910,842 130,529 ST MARY'S PA NORTHLAND CENTER 1,198,947 4,824,500 143,378 STATE COLLEGE PA SHOPS AT PROSPECT 741,941 2,967,765 70,154 WEST HEMPFIELD PA YORK MARKETPLACE 3,199,353 12,797,412 604,868 YORK PA CONGRESS CROSSING 1,098,351 6,747,013 84,281 ATHENS TN WEST TOWNE SQUARE SHOPPING CENTER 529,103 3,880,088 ELIZABETHTON TN GREENEVILLE COMMONS 1,075,200 7,884,800 23,156 GREENEVILLE TN KINGS GIANT SHOPPING CENTER 2,500,633 268,686 KINGSPORT TN GEORGETOWN SQUARE 1,166,924 4,674,698 208,425 MURFREESBORO TN SHOPPING CENTER - COLONIAL HTS 290,000 792,441 COLONIAL HEIGHTS VA HANOVER SQUARE SHOPPING CENTER 1,778,701 7,114,805 210,309 MECHANICSVILLE VA VICTORIAN SQUARE 3,548,432 14,208,727 115,710 MIDLOTHIAN VA
COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I - --------- ------------------------------------ ------------ ---------- -------- -------- Gross Amount at Which Carried at the Close of the Period ------------------------------------ Life on Which Depreciated Building & Accumulated Date of Date in Latest Description Land Improvements Total(1) Depreciation Construction Acquired Income Stmt. - ----------- -------- ------------ ------------ ------------ ------------ -------- ------------- Shopping Centers ************************** STRAWBRIDGE'S 605,607 3,923,050 4,528,657 3,923,050 1964 Jan 64 35 Years PHILADELPHIA PA ST MARY'S PLAZA 977,711 4,041,371 5,019,082 382,864 1970 Dec 94 40 Years ST MARY'S PA NORTHLAND CENTER 1,198,947 4,967,878 6,166,825 805,293 1988 Jun 92 40 Years STATE COLLEGE PA SHOPS AT PROSPECT 741,941 3,037,919 3,779,860 232,483 1994 Jul 95 40 Years WEST HEMPFIELD PA YORK MARKETPLACE 3,199,353 13,402,280 16,601,633 1,089,908 1955 May 95 40 Years YORK PA CONGRESS CROSSING 1,098,351 6,831,294 7,929,645 1,107,084 1990 Mar 92 40 Years ATHENS TN WEST TOWNE SQUARE SHOPPING CENTER 529,103 3,880,088 4,409,191 24,251 1970,1998 Jun 98 40 Years ELIZABETHTON TN GREENEVILLE COMMONS 1,075,200 7,907,956 8,983,156 1,276,938 1990 Mar 92 40 Years GREENEVILLE TN KINGS GIANT SHOPPING CENTER 2,769,319 2,769,319 433,692 1970 Sep 92 40 Years KINGSPORT TN GEORGETOWN SQUARE 1,166,924 4,883,123 6,050,047 686,017 1986 Sep 93 40 Years MURFREESBORO TN SHOPPING CENTER - COLONIAL HTS 290,000 792,441 1,082,441 277,355 1972 May 86 35 Years COLONIAL HEIGHTS VA HANOVER SQUARE SHOPPING CENTER 1,778,701 7,325,114 9,103,815 1,091,417 1991 Jan 93 40 Years MECHANICSVILLE VA VICTORIAN SQUARE 3,548,432 14,324,437 17,872,869 1,568,749 1991 Mar 94 40 Years MIDLOTHIAN VA
F-38 93 NEW PLAN REALTY TRUST AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION July 31, 1998
COLUMN A COLUMN B COLUMN C COLUMN D - --------- -------- ----------------------- ----------------- Cost Capitalized Subsequent to Initial Cost to Company Acquisition ----------------------- ---------------- Building & Description Encumbrance Land Improvements Improvements - ----------- ----------- ------- ------------- ------------ Shopping Centers ************************* CAVE SPRING CORNERS SHOPPING CNTR 1,064,298 4,257,792 ROANOKE VA HUNTING HILLS SHOPPING CNTR 4,345,924 1,897,007 6,010,376 ROANOKE VA SHOPPING CENTER - SPOTSYLVANIA 250,000 1,363,880 250,195 SPOTSYLVANIA VA LAKE DRIVE PLAZA 3,890,137 1,432,155 4,616,848 37,200 VINTON VA RIDGEVIEW CENTRE 2,707,679 4,417,792 567,515 WISE VA MOUNDSVILLE PLAZA 228,283 1,989,798 5,095,518 MOUNDSVILLE WV GRAND CENTRAL PLAZA 4,358,333 153,150 PARKERSBURG WV KMART PLAZA 664,121 2,656,483 143,331 VIENNA WV Vacant Land ************************* ROXBURY TOWNSHIP NJ 258,861 7,523 ROXBURY NJ 1 NORTH CENTRAL AVENUE 17,953 HARTSDALE NY ------------ -------------- -------------- ------------ $114,098,899 $272,176,260 $1,034,523,259 $146,038,200 ============ ============== ============== ============
COLUMN A COLUMN E COLUMN F - --------- ------------------------------------------------ ------------ Gross Amount at Which Carried at the Close of the Period ----------------------------------------------- Building & Accumulated Description Land Improvements Total(1) Depreciation - ----------- -------- ------------ ------------ ------------ Shopping Centers ************************* CAVE SPRING CORNERS SHOPPING CNTR 1,064,298 4,257,792 5,322,090 119,557 ROANOKE VA HUNTING HILLS SHOPPING CNTR 1,897,007 6,010,376 7,907,383 43,826 ROANOKE VA SHOPPING CENTER - SPOTSYLVANIA 250,000 1,614,075 1,864,075 499,568 SPOTSYLVANIA VA LAKE DRIVE PLAZA 1,432,155 4,654,048 6,086,203 33,897 VINTON VA RIDGEVIEW CENTRE 2,707,679 4,985,307 7,692,986 744,631 WISE VA MOUNDSVILLE PLAZA 228,283 7,085,316 7,313,599 902,903 MOUNDSVILLE WV GRAND CENTRAL PLAZA 4,511,483 4,511,483 1,125,349 PARKERSBURG WV KMART PLAZA 664,121 2,799,814 3,463,935 369,452 VIENNA WV Vacant Land ************************* ROXBURY TOWNSHIP NJ 258,861 7,523 266,384 ROXBURY NJ 1 NORTH CENTRAL AVENUE 17,953 17,953 HARTSDALE NY ------------ -------------- -------------- ------------- $272,176,260 $1,180,561,459 $1,452,737,719 $136,977,511 ============ ============== ============== =============
COLUMN A COLUMN G COLUMN H COLUMN I - --------- ---------- -------- -------- Life on Which Depreciated Date of Date in Latest Description Construction Acquired Income Stmt. - ----------- ------------ -------- ------------- Shopping Centers ************************* CAVE SPRING CORNERS SHOPPING CNTR 1969 Jun 97 40 Years ROANOKE VA HUNTING HILLS SHOPPING CNTR 1989 Apr 98 40 Years ROANOKE VA SHOPPING CENTER - SPOTSYLVANIA 1970 May 86 35 Years SPOTSYLVANIA VA LAKE DRIVE PLAZA 1976 Feb 98 40 Years VINTON VA RIDGEVIEW CENTRE 1990 Jul 92 40 Years WISE VA MOUNDSVILLE PLAZA 1961 Dec 88 40 Years MOUNDSVILLE WV GRAND CENTRAL PLAZA 1986 Jun 88 40 Years PARKERSBURG WV KMART PLAZA 1975 Feb 93 40 Years VIENNA WV Vacant Land ************************* ROXBURY TOWNSHIP NJ 1998 Dec 97 ROXBURY NJ 1 NORTH CENTRAL AVENUE Jul 72 HARTSDALE NY
(1) Aggregate cost is the same for Federal income tax purposes F-39 94 NEW PLAN REALTY TRUST REAL ESTATE AND ACCUMULATED DEPRECIATION (Amounts in Thousands) SCHEDULE III JULY 31, 1998 (continued) Reconciliation of Real Estate and Accumulated Depreciation:
1998 1997 1996 ---------- ---------- ---------- INVESTMENT IN REAL ESTATE Balance at beginning of period $1,277,775 $977,942 $765,080 Additions during the period: Land 39,281 58,502 40,641 Buildings and improvements 135,682 246,888 177,888 ---------- ---------- ---------- 1,452,738 1,283,332 983,609 Less: Costs of assets sold and written-off -- 5,557 5,667 ---------- ---------- ---------- Balance at end of period $1,452,738 $1,277,775 $977,942 ========== ========== ========== ACCUMULATED DEPRECIATION Balance at beginning of period $105,866 $82,523 $64,007 Additions charged to operating expenses 31,112 24,620 19,724 ---------- ---------- ---------- 136,978 107,143 83,731 Less: Accumulated depreciation on assets sold and written-off -- 1,277 1,208 ---------- ---------- ---------- Balance at end of period $136,978 $105,866 $82,523 ========== ========== ==========
F-40 95 NEW PLAN REALTY TRUST AND SUBSIDIARIES MORTGAGE LOANS AND NOTES RECEIVABLE ON REAL ESTATE (Amounts in Thousands) SCHEDULE IV
July 31, 1998 COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F COLUMN G - -------- -------- -------- -------- -------- -------- -------- Final Face Face Carrying Interest Maturity Periodic Amount of Amount of Description Rate Date Payment Terms Prior Liens Mortgages Mortgages - ----------- ---- ---- ------------- ----------- --------- --------- Purchase money first mortgage, collateralized by a shopping Interest payable center in Connellsville, PA monthly, balance at 10% 8/31/1998 maturity $ 5,420 $ 5,180 Interest payable Purchase money first mortgage, monthly, $45,000 collateralized by a shopping principal per month center in Whitesboro, NY for 17 months, 9.38% 7/30/1999 balance at maturity 4,610 4,205 Leasehold mortgage, Interest and collateralized by a tenant lease principal payable 11.5% 4/30/2004 monthly 259 212 Leasehold mortgage, Interest and collateralized by a tenant lease principal payable 12% 5/1/2008 monthly 1,000 864 Purchase money first mortgage, collateralized by a shopping Interest payable center in Harrisonburg, VA monthly, balance at 9% 7/23/2000 maturity 794 645 Purchase money first mortgage, Interest payable collateralized by a shopping quarterly and center in principal payable at New Bern, NC 7.2% 5/9/2001 maturity 750 750 Purchase money first mortgage Interest payable collateralized by shopping monthly and principal center in payable at maturity Hanover, PA 8.75% 7/23/2001 700 700 Leasehold mortgage Interest and collateralized by a tenant lease principal payable 10% 5/31/2008 monthly 1,335 1,322 ------- ------- $14,868 $13,878 ======= =======
Note: Column H is not applicable F-41 96 NEW PLAN REALTY TRUST AND SUBSIDIARIES MORTGAGE LOANS AND NOTES RECEIVABLE ON REAL ESTATE (Amounts in Thousands) SCHEDULE IV (continued) Year Ended July 31,
1998 1997 1996 -------- -------- -------- Balance, beginning of period $23,107 $23,597 $22,874 Additions during period: New loans 1,322 700 1,544 Reductions during period: Collection of principal (10,551) (1,190) (821) -------- -------- -------- Balance, end of period $13,878 $23,107 $23,597 ======== ======== ========
F-42 97 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of 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. NEW PLAN REALTY TRUST (Registrant) By: /s/ ARNOLD LAUBICH ----------------------- Arnold Laubich Chief Executive Officer Dated: October 28, 1998 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date --------- ----- ---- /s/ WILLIAM NEWMAN Chairman of the Board October 28, 1998 - ----------------------- William Newman /s/ ARNOLD LAUBICH Chief Executive Officer October 28, 1998 - ----------------------- and Trustee Arnold Laubich /s/ GARY B. SABIN President, Chairman of October 28, 1998 - ----------------------- Investment Committee and Gary B. Sabin Trustee /s/ JAMES M. STEUTERMAN Executive Vice President, October 28, 1998 - ----------------------- Co-Chief Operating Officer James M. Steuterman and Trustee /s/ RICHARD B. MUIR Executive Vice President, October 28, 1998 - ----------------------- Co-Chief Operating Officer Richard B. Muir and Trustee /s/ DAVID A. LUND Chief Financial Officer and October 28, 1998 - ----------------------- Chief Accounting Officer David A. Lund /s/ DEAN BERNSTEIN Senior Vice President--Finance October 28, 1998 - ----------------------- and Multifamily and Trustee Dean Bernstein /s/ RAYMOND H. BOTTORF Trustee October 28, 1998 - ----------------------- Raymond H. Bottorf 98 /s/ NORMAN GOLD Trustee October 28, 1998 - ------------------------ Norman Gold /s/ BOYD A. LINDQUIST Trustee October 28, 1998 - ------------------------ Boyd A. Lindquist /s/ MELVIN NEWMAN Trustee October 28, 1998 - ------------------------ Melvin Newman /s/ ROBERT E. PARSONS, JR. Trustee October 28, 1998 - ------------------------ Robert E. Parsons, Jr. /s/ BRUCE A. STALLER Trustee October 28, 1998 - ------------------------ Bruce A. Staller /s/ JOHN WETZLER Trustee October 28, 1998 - ------------------------ John Wetzler /s/ GREGORY WHITE Trustee October 28, 1998 - ------------------------ Gregory White /s/ JOHN H. WILMOT Trustee October 28, 1998 - ------------------------ John H. Wilmot 99 EXHIBIT INDEX
Exhibit No. Description ----------- ----------- *3.1 Amended and Restated Declaration of Trust of New Plan Realty Trust dated as of January 15, 1996 filed as Exhibit 99.3 to the Registrant's Form 8-K dated May 24, 1996. 3.2 Certificate of Amendment of Amended and Restated Declaration of Trust of New Plan Realty Trust dated September 25, 1998. *4.1 Specimen Certificate for Shares of Beneficial Interest filed as Exhibit 4.1 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *4.2 Certificate of Designation Supplementing the Amended and Restated Declaration of Trust of New Plan Realty Trust filed as Exhibit 4.1 to the Registrant's Form 8-K dated July 2, 1997. *4.3 Deposit Agreement dated as of July 3, 1997 among New Plan Realty Trust and Bank Boston N.A. filed as Exhibit 4.5 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *4.4 Specimen Certificate for 7.80% Series A Cumulative Step-Up Premium Rate Preferred Shares filed as Exhibit 4.4 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *4.5 Specimen Depositary Receipt filed as Exhibit 4.5 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. *9.1 Agreement dated February 26, 1979 among William Newman, Joseph Newman and Melvin Newman filed as Exhibit 9 to Registration Statement No. 2--63669. *9.2 Purchase Agreement dated December 18, 1990 between New Plan Realty Trust and Beleggingsmaatschappij Midas B.V. (presently known as Stichting Pensioenfonds) filed as Exhibit 9.5 to the Registrant's Form 10-K for the fiscal year ended July 31, 1994. *9.3 Termination of Purchase Agreement dated December 17, 1981 between New Plan Realty Trust and Merchant Navy Officers Pension Fund Trustees Limited (presently known as MNOPF Trustees Limited) filed as Exhibit 9.6 to the Registrant's Form 10-K for the fiscal year ended July 31, 1995.
100 *10.1 Credit Agreement by and among New Plan Realty Trust, the Lenders party thereto and The Bank of New York, as agent, dated as of October 20, 1996 filed as Exhibit 10.1 to the Registrant's Form 10-K for the fiscal year ended July 31, 1997. 10.2 Assignment and Assumption Agreement dated December 1, 1997 by and among New Plan Realty Trust, Bank Hapoalim B.M. and The Bank of New York. 10.3 Waiver and Amendment to Credit Agreement dated as of September 25, 1998 by and among New Plan Realty Trust, the Lenders party thereto and The Bank of New York, as agent. 10.4 Assumption and Substitution Agreement dated as of September 28, 1998 by and among New Plan Excel Realty Trust, Inc., New Plan Realty Trust, the Lenders party thereto and The Bank of New York, as agent. 10.5 Unconditional Guaranty of Payment and Performance dated as of September 28, 1998 by and between New Plan Realty Trust and BankBoston N.A. *10.6 Senior Securities Indenture between New Plan Realty Trust and The First National Bank of Boston, as Trustee, dated as of March 29, 1995 filed as Exhibit 4.2 to Registration Statement No. 33-60045. *10.7 7.75% Senior Note Due April 6, 2005 filed as Exhibit 10.7 to the Registrant's Form 10-K for the fiscal year ended July 31, 1995. *10.8 6.8% Senior Note Due May 15, 2002 filed as Exhibit 10.8 to the Registrant's Form 10-K for the fiscal year ended July 31, 1995. *10.9 Distribution Agreement dated May 24, 1996 by and among New Plan Realty Trust, Lehman Brothers, Lehman Brothers Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated and Smith Barney Inc., filed as Exhibit 1 to the Registrant's Form 8-K dated May 24, 1996. *10.10 Form of Medium Term Note (Fixed Rate) filed as Exhibit 99.1 to the Registrant's Form 8-K dated May 24, 1996. *10.11 Form of Medium Term Note (Floating Rate) filed as Exhibit 99.2 to the Registrant's Form 8-K dated May 24, 1996. *10.12 Distribution Agreement dated December 6, 1996 by and among New Plan Realty Trust, Lehman Brothers, Lehman Brothers Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated, Salomon Brothers Inc. and Smith Barney Inc., filed as Exhibit 1 to the Registrant's Form 8-K dated December 12, 1996.
101 *10.13 Form of Medium Term Note (Fixed Rate) filed as Exhibit 4.1 to the Registrant's Form 8-K dated December 12, 1996. *10.14 Form of Medium Term Note (Floating Rate) filed as Exhibit 4.2 to the Registrant's Form 8-K dated December 12, 1996. *10.15 Agreement and Plan of Merger, dated May 14, 1998, as amended as of August 7, 1998, among Excel Realty Trust, Inc., ERT Merger Sub, Inc. and New Plan Realty Trust filed as Exhibit 2.1 to the Registrant's Form 8-K dated October 13, 1998. 12 Ratio of Earnings to Fixed Charges. 21 Subsidiaries of the Registrant. 23 Consent of PRICEWATERHOUSECOOPERS LLP. 27(1) Financial Data Schedule. 99.1 Pro Forma Financial Data of New Plan Excel Realty Trust, Inc.
- ------------------------------ *Incorporated herein by reference as above indicated. (1) Filed as exhibit to electronic filing only. EX-3.2 2 CERTIFICATE OF AMENDMENT 1 Exhibit 3.2 CERTIFICATE OF AMENDMENT OF AMENDED AND RESTATED DECLARATION OF TRUST OF NEW PLAN REALTY TRUST WHEREAS Section 13.1 of the Amended and Restated Declaration of Trust of New Plan Realty Trust (the "Trust") dated as of January 15, 1996 (and filed with the Secretary of The Commonwealth of Massachusetts on March 12, 1996), as supplemented by Certificate of Designation filed with the Secretary of The Commonwealth of Massachusetts on July 3, 1997 (collectively the "New Plan Declaration of Trust") provides that the New Plan Declaration of Trust may be amended by the majority vote of the Trustees and the affirmative vote of the holders of not less than 66-2/3% of the Shares then outstanding having the right to vote thereon, which amendment shall be effective upon the filing with said Secretary of a certificate signed and acknowledged by a Trustee setting forth the text of such amendments; NOW, THEREFORE, the undersigned, being a duly elected and serving Trustee of the Trust, hereby certifies that the New Plan Declaration of Trust has been amended by the addition of Section 13.4 thereto, the text of which is set forth in the "New Plan Trust Amendments" contained in Annex II hereto (there being no Annex I, said Annex II being identical to the Annex contained in the proxy statement for the special meeting of shareholders of the Trust hereinbelow referred to) which have been duly adopted by the affirmative vote of a majority of the Trustees of the Trust and by the affirmative vote of the holders of more than 66-2/3% of the Shares outstanding and entitled to vote thereon, which meeting of shareholders was duly called and held on September 25, 1998 in accordance with the requirements of the New Plan Declaration of Trust. IN WITNESS WHEREOF, I have executed this Certificate of Amendment this 25th day of September, 1998 and acknowledge the same to be my free act and deed as a Trustee of New Plan Realty Trust. /s/ ARNOLD LAUBICH ---------------------------- Arnold Laubich, Trustee 2 COMMONWEALTH OF MASSACHUSETTS Suffolk, ss. Acknowledged before me this 25th day of September, 1998. /s/ WILLIAM BRUCE KING ---------------------------- William Bruce King Notary Public My commission expires August 24, 2001. 2 3 ANNEX II NEW PLAN TRUST AMENDMENTS The following new Section 13.4 is added to the New Plan Declaration of Trust SECTION 13.4 Alternative Business Combination. 13.4.1 General. In lieu of a reorganization or business combination followed by the termination of the Trust and the distribution of the securities of the successor organization among the Shareholders in redemption of their Shares according to their respective rights pursuant to Section 13.3, the Trustees may cause the Trust to merge with another entity in a reorganization or business combination transaction ("Alternative Business Combination Transaction") pursuant to which (a) the Shares of the Trust are exchanged for such securities of a Person of which such other entity is a subsidiary or for such other consideration as is provided for in the agreement among the Trust, such other entity and such Person, and (b) the Trust is not terminated but remains in existence as a subsidiary of such Person. 13.4.2 Excel Realty Trust, Inc. Merger Approved. Specifically, the Trustees may implement the merger provided for in the Agreement and Plan of Merger among New Plan Realty Trust, ERT Merger Sub, Inc. and Excel Realty Trust, Inc., as amended as of August 7, 1998, approved by the affirmative vote of 66-2/3% or more of all outstanding Shares of the Trust having the right to vote thereon at the meeting of Shareholders held on September 25, 1998, a copy of which is attached as an Annex to the notice and proxy statement for such meeting (such merger and agreement hereinafter the "Excel Merger" and the "Excel Merger Agreement," respectively). Upon effectiveness of the Excel Merger as provided in the Excel Merger Agreement, (a) the outstanding Shares of Beneficial Interest and the outstanding Preferred Shares of the Trust shall be exchanged for the securities or rights to securities of Excel Realty Trust, Inc. (whose name may thereupon be changed to New Plan Excel Realty Trust, Inc. (hereinafter referred to as "Surviving REIT")) as provided in the Excel Merger Agreement; (b) Surviving REIT shall become the sole holder of Shares of Beneficial Interest of the Trust as provided in the Excel Merger Agreement, with the Trust thereupon becoming a wholly-owned subsidiary of Surviving REIT; and (c) the number and identity of the Trustees shall be as set forth in the Excel Merger Agreement. The Trustees shall have full power and authority to, and shall, take or authorize such actions as they determine to be appropriate or convenient to carry out and to implement the Excel Merger Agreement and to effect the Excel Merger. 13.4.3 Approval of Shareholders. This Section 13.4 has been added to the Declaration of Trust by an amendment thereto approved by the Trustees and the affirmative vote of 66-2/3% or more of all outstanding Shares of the Trust having the right to vote thereon at the meeting of Shareholders held on September 25, 1998, as part of the same meeting and/or vote that approved the Excel Merger provided for in Section 13.4.2. Accordingly, the Excel Merger having been approved by the affirmative vote of 66-2/3% or more of all outstanding Shares of the Trust having the right to vote thereon, no further action by the Shareholders is necessary to approve and effect the Excel Merger. However, in the event that the Excel Merger should not be effected for any reason and the Trustees recommend an Alternative Business Combination Transaction of the type authorized in Section 13.4.1 with some other Person, the authority of the Trustees to implement such other Alternative Business Combination Transaction shall be subject to the prior approval by the affirmative vote of 66-2/3% or more of all outstanding Shares of the Trust having the right to vote thereon at a meeting of Shareholders the notice for which includes a description of the principal terms of such Alternative Business Combination Transaction. 13.4.4 Consummation of Alternative Business Combination Transaction. Notwithstanding any other provision hereof, including without limitation any provision with respect to shareholder ownership limitations or REIT status, any Alternative Business Combination Transaction (including the Excel Merger) may be consummated in accordance with this Section 13.4. EX-10.2 3 ASSIGNMENT AND ASSUMPTION AGREEMENT 1 Exhibit 10.2 ASSIGNMENT AND ASSUMPTION AGREEMENT This Assignment and Assumption Agreement is made and entered into as of December 1, 1997, by and between THE BANK OF NEW YORK (the "Assignor") and BANK HOPOALIM, B.M. (the "Assignee"). R E C I T A L S A. The Assignor, certain other lenders (together with any prior assignees, the "Lenders") and The Bank of New York, as agent (the "Agent"), are parties to that certain Credit Agreement dated as of November 21, 1997 (the "Credit Agreement") with New Plan Realty Trust, a Massachusetts business trust (the "Borrower"). Pursuant to the Credit Agreement, the Lenders agreed to make Revolving Credit Loans under Commitments in the aggregate amount of $50,000,000, subject to Commitment Increases, as provided in Section 2.20 thereof. The amount of the Assignor's Commitment (before giving effect to this Assignment) is specified in Item 1 of Schedule 1 hereto. The outstanding principal amount of the Assignor's Loans under its Commitment (before giving effect to this Assignment) is specified in Item 2 of Schedule 1 hereto. All capitalized terms not otherwise defined herein are used herein as defined in the Credit Agreement. B. The Assignor wishes to sell and assign to the Assignee, and the Assignee wishes to purchase and assume from the Assignor, (i) the portion of the Assignor's Commitment specified in Item 3 of Schedule 1 hereto (the "Assigned Commitment") and (ii) the portion of the Assignor's Loans specified in Item 5 of Schedule 1 hereto (the "Assigned Loans"). The parties agree as follows: 1. Assignment. Subject to the terms and conditions set forth herein and in the Credit Agreement, the Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases and assumes from the Assignor, without recourse, on the date set forth above (the "Assignment 2 Date") (a) all right, title and interest of the Assignor to the Assigned Loans and (b) all obligations of the Assignor under the Credit Agreement with respect to the Assigned Commitment and as a "Lender" thereunder. As full consideration for the sale of the Assigned Loans and the Assigned Commitment, the Assignee shall pay to the Assignor on the Assignment Date the principal amount of the Assigned Loans (the "Purchase Price"). 2. Representation and Warranties. Each of the Assignor and the Assignee represents and warrants to the other that (a) it has full power and legal right to execute and deliver this Agreement and to perform the provisions of this Agreement; (b) the execution, delivery and performance of this Agreement have been authorized by all action, corporate or otherwise, and do not violate any provisions of its charter or by-laws or any contractual obligations or requirement of law binding on it; and (c) this Agreement constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms. 3. Condition Precedent. The obligations of the Assignor and the Assignee hereunder shall be subject to the fulfillment of the condition that the Assignor shall have (a) received payment in full of the Purchase Price, and (b) complied with the other applicable provisions of Section 11.7 of the Credit Agreement. 4. Notice of Assignment. The Assignor agrees to give notice of the assignment and assumption of the Assigned Loans and the Assigned Commitment to the Agent and the Borrower and hereby instructs the Agent and the Borrower to make all payments with respect to the Assigned Loans and the Assigned Commitment directly to the Assignee at the applicable Lending Offices specified in Item 6 on Schedule 1 hereto, or to the Agent for the account of the Assignee as a Lender (in either case, as required by the terms of the Credit Agreement); provided, however, that the Borrower and the Agent shall be entitled to continue to deal solely and - 2 - 3 directly with the Assignor in connection with the interests so assigned until the Agent and the Borrower, to the extent required by Section 11.7 of the Credit Agreement, shall have received notice of the assignment, the Borrower and the Agent shall have consented in writing thereto, and the Agent shall have recorded and accepted this Agreement and received the Assignment Fee required to be paid pursuant to Section 11.7 of the Credit Agreement. From and after the date (the "Assignment Effective Date") on which the Agent shall notify the Borrower and the Assignor that the requirements set forth in the foregoing sentence shall have occurred and all consents (if any) required shall have been given, (i) the Assignee shall be deemed to be a party to the Credit Agreement and, to the extent that rights and obligations thereunder shall have been assigned to Assignee as provided in such notice of assignment to the Agent, shall have the rights and obligations of a Lender under the Credit Agreement, and (ii) the Assignee shall be deemed to have appointed the Agent to take such action as agent on its behalf and to exercise such powers under the Loan Documents as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto. The Assignee agrees that the provisions of Section 10 of the Credit Agreement are hereby incorporated into this Agreement by this reference, as if fully set forth herein at length. After the Assignment Effective Date, the Agent shall make all payments in respect of the interest assigned hereby (including payments of principal, interest, fees and other amounts) to the Assignee. The Assignor and Assignee shall make all appropriate adjustment in payments under the Assigned Loans and the Assigned Commitment for periods prior to the Assignment Effective Date hereof directly between themselves. The Assignee agrees to deliver to the Borrower and the Agent such Internal Revenue Service forms as may be required to establish that the Assignee is entitled to receive payments under the Credit Agreement without deduction or withholding of tax. - 3 - 4 5. Independent Investigation. The Assignee acknowledges that it is purchasing the Assigned Loans and the Assigned Commitment from the Assignor totally without recourse and, except as provided in Section 2 hereof, without representation or warranty. The Assignee further acknowledges that it has made its own independent investigation and credit evaluation of the Borrower in connection with its purchase of the Assigned Loans and the Assigned Commitment. Except for the representations or warranties set forth in Section 2, the Assignee acknowledges that it is not relying on any representation or warranty of the Assignor, expressed or implied, including without limitation, any representation or warranty relating to the legality, validity, genuineness, enforceability, collectibility, interest rate, repayment schedule or accrual status of the Assigned Loans or the Assigned Commitment, the legality, validity, genuineness or enforceability of the Credit Agreement, the related Notes, or any other Loan Document referred to in or delivered pursuant to the Credit Agreement, or financial condition or creditworthiness of the Borrower or any other Person. The Assignor has not and will not be acting as either the representative, agent or trustee of the Assignee with respect to matters arising out of or relating to the Credit Agreement or this Agreement. From and after the Assignment Effective Date, except as set forth in Section 4 above, the Assignor shall have no rights or obligations with respect to the Assigned Loans or the Assigned Commitments. 6. Consent of the Borrower and Agent; Exchange of Notes. Pursuant to the provisions of Section 11.7 of the Credit Agreement, and to the extent required thereby, the Borrower and Agent, by signing below, consents to this Agreement and to the assignment contemplated herein. The Borrower further agrees upon receipt of the Assignor's Note, to execute and deliver: (a) to the Assignee, a Note, in an aggregate principal amount of $10,000,000. - 4 - 5 (b) to the Assignor, a Note, in an aggregate principal amount of $20,000,000. At the request of the Borrower, the Lender whose obligations under its Note have been fully paid or who has received a replacement Note pursuant to the foregoing, shall promptly return to the Borrower its Note or superseded Note, as the case may be, or other evidence that such Lender has received full payment of such obligations or a replacement Note in respect of such superseded Note. 7. Method of Payment. All payments to be made by either party hereunder shall be in funds available at the place of payment on the same day and shall be made by wire transfer to the account designated by the party to receive payment. 8. Integration. This Agreement shall supersede any prior agreement or understanding between the parties (other than the Credit Agreement) as to the subject matter hereof. 9. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and shall be binding upon both parties, their successors and assigns. 10. Headings. Section headings have been inserted herein for convenience only and shall not be construed to be a part hereof. 11. Amendments; Waivers. This Agreement may not be amended, changed, waived or modified except by a writing executed by the parties hereto, and may not be amended, changed, waived or modified in any manner inconsistent with Section 11.7 of the Credit Agreement without the prior written consent of the Agent. 12. Governing Law. This Agreement shall be governed by, and construed in accordance with the laws of, the State of New York. - 5 - 6 13. Limited Recourse Obligations. This Agreement and all documents, agreements, understandings and arrangements relating to this transaction have been negotiated, executed and delivered on behalf of the Borrower by the trustees or officers thereof in their representative capacity under the Declaration of Trust, and not individually, and bind only the trust estate of the Borrower, and no trustee, officer, employee, agent or shareholder of the Borrower shall be bound or held to any personal liability or responsibility in connection with the agreements, obligations and undertakings of the Borrower hereunder, and any person or entity dealing with the Borrower in connection therewith shall look only to the trust estate for the payment of any claim or for the performance of any agreement, obligation or undertaking thereunder. The Agent and each Lender hereby acknowledge and agree that each agreement and other document executed by the Borrower in accordance with or in respect of this transaction shall be deemed and treated to include in all respects and for all purposes the foregoing exculpatory provision. THE BANK OF NEW YORK By: /s/ ANDREA STUART ----------------------------- Andrea Stuart Vice President - 6 - 7 BANK HAPOALIM, B.M. By: /s/ SHAUN BREIDBART ----------------------------- Shaun Breidbart Vice President Consented to: NEW PLAN REALTY TRUST By: /s/ DEAN BERNSTEIN ----------------------------- Dean Bernstein Vice President THE BANK OF NEW YORK, as Agent By: /s/ ANDREA STUART ----------------------------- Andrea Stuart Vice President - 7 - EX-10.3 4 WAIVER AND AMENDMENT TO CREDIT AGREEMENT 1 Exhibit 10.3 WAIVER AND AMENDMENT TO CREDIT AGREEMENT THIS WAIVER AND AMENDMENT TO CREDIT AGREEMENT (the "Amendment") is made and entered into as of September 25, 1998, among NEW PLAN REALTY TRUST, a Massachusetts business trust, ("New Plan" or the "Borrower"), THE BANK OF NEW YORK, as agent for the Lenders (the "Agent"), and the financial institutions listed on the signature pages hereto. RECITALS: A. The Borrower, the Agent and certain financial institutions entered into that certain Credit Agreement dated as of November 21, 1997 (as amended, the "Credit Agreement"; defined terms used in this Amendment which are not otherwise defined herein shall have the meaning ascribed to such terms in the Credit Agreement). B. The Borrower has entered into that certain Agreement and Plan of Merger among the Borrower, Excel Realty Trust, Inc. ("Excel"), and ERT Merger Sub, Inc. ("Merger Sub"), dated May 14, 1998, as amended by that certain Amendment to Agreement and Plan of Merger, dated as of August 7, 1998, among the Borrower, Excel and the Merger Sub (collectively, the "Merger Agreement"). C. In accordance with the Merger Agreement, at the Effective Time under and as defined in the Merger Agreement (the "Effective Time") (i) shares of beneficial interest of New Plan will be converted into the right to receive common shares of the stock of the Combined Company (hereinafter defined), (ii) the Merger Sub will be merged with and into New Plan with New Plan surviving as a wholly owned subsidiary of Excel, (iii) Excel will change its name to "New Plan Excel Realty Trust, Inc." (such entity being, from and after the Effective Time, the "Combined Company") and (iv) the merger contemplated by the Merger Agreement (the "Merger") will be consummated by filing the appropriate articles of merger and certificate of amendment and merger with the appropriate authorities in the State of Maryland and Commonwealth of Massachusetts, all as more particularly described in the Merger Agreement and the Proxy Statement (hereinafter defined). D. The Borrower and Excel have called meetings of their respective shareholders to be held on September 25, 1998 to approve the Merger and other matters set forth in the Joint Proxy Statement/Prospectus dated August 12, 1998 (the "Proxy Statement"). If approved, the Borrower contemplates that the Effective Time will occur prior to October 1, 1998. 2 E. The Borrower's consummating the Merger and the other transactions contemplated by the Merger Agreement and the Proxy Statement will constitute an Event of Default under Sections 8.2, 8.5, 8.7 and 9.1(o) of the Credit Agreement. The Borrower has requested that as of the Effective Time the Agent and the Lenders (i) waive the Event of Defaults occurring by reason of the consummation of the Merger and the other transactions contemplated by the Merger Agreement and the Proxy Statement, (ii) permit the Combined Company to be substituted for the Borrower under the Credit Agreement and assume the obligations of the Borrower thereunder, (iii) accept the Guaranty of New Plan Realty Trust, as a wholly owned subsidiary of the Combined Company, in support of the obligations of the Combined Company under the Credit Agreement and (iv) acknowledge that the fiscal year of the Combined Company and New Plan will be a calendar year. F. The Agent and the Lenders are agreeable to such requests, subject to the terms of this Amendment. NOW, THEREFORE, for and in consideration of the mutual promises and mutual agreements contained herein, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 1. Waiver. Subject to the compliance by the applicable parties with the provisions of Section 14 of this Amendment, the Agent and the Lenders consent, as of the Effective Time, to the Merger and the other transactions contemplated by the Merger Agreement and the Proxy Statement and waive, as of the Effective Time, any Event of Default under Section 8.2, 8.5, 8.7 or Section 9.1(o) of the Credit Agreement occurring by reason of the consummation of the Merger in accordance with the Merger Agreement and the Proxy Statement (each a "Merger Default" and collectively, the "Merger Defaults"). 2. Amended Definitions. As of the Effective Time, Section 1.1 of the Credit Agreement ("Definitions") shall be deemed amended by deleting therefrom the definitions of "Maturity Date," "Revolving Credit Termination Date" and "Total Capital" and substituting in their place the following new definitions therefor: "Maturity Date": (i) if the Term Loan is not elected pursuant to Section 2.2, the earlier of the Revolving Credit Termination Date or the date on which the Notes shall become due and payable, whether by acceleration or otherwise, and (ii) if the Term Loan is so elected, the earlier of November 20, 1999 or the date 2 3 on which the Notes shall become due and payable, whether by acceleration or otherwise. "Revolving Credit Termination Date": January 31, 1999. "Total Capital": shall mean on any date, the sum of (i) all long term debt of the Borrower and its Subsidiaries on a Consolidated basis (inclusive of medium term notes) on such date, (ii) the stockholders' equity in the Borrower on such date, as determined in accordance with GAAP, (iii) the value of issued and outstanding preferred stock of the Borrower on such date, (iv) all Loans outstanding on such date, and (v) all loans under the BankBoston Credit Agreement outstanding on such date. 3. Threshold Amount. As of the Effective Time, the definition of "Threshold Event" in the Credit Agreement shall be deemed amended to eliminate the number "$150,000,000" therein and substitute in its place the number $0.00 in its place. Accordingly, as of the Effective Time, the "Threshold Amount" under and as defined in the Credit Agreement shall be $0.00. 4. New Definitions. As of the Effective Time, Section 1.1 of the Credit Agreement ("Definitions") shall be deemed further amended by adding thereto the following new defined terms (the same to be inserted into Section 1.1 in proper alphabetical order): "BankBoston Credit Agreement": That certain First Amended and Restated Revolving Credit Agreement among Excel, BankBoston, N.A., as Agent, and the lenders who are signatories thereto, dated as of March 31, 1998, as amended pursuant to that certain First Amendment to First Amended and Restated Revolving Credit Agreement, among Excel, BankBoston, N.A., as Agent, and the lenders signatory thereto, dated as of September 25, 1998, and all amendments thereto. "Guarantor": New Plan Realty Trust, its successors and assigns. "Guaranty": That certain Guaranty of the Guarantor executed or to be executed and delivered by the Guarantor under which the Guarantor guaranties the payment when due of the obligations of the Borrower under this Agreement and the other Loan Documents. 3 4 5. Representations. The parties acknowledge that as of the Effective Time, Schedules 4.1, 4.5, 4.12, 8.3 and 8.4 will be revised and replaced pursuant to the terms of the Assumption and Substitution Agreement attached hereto as Attachment 1, and such replacement shall effectively amend the Sections of the Credit Agreement corresponding to such Schedules. In addition, as of the Effective Time, the following new Section 4.21 shall be deemed added to the Credit Agreement at the end of Article 4 of the Credit Agreement: 4.21 BankBoston Credit Agreement. No Event of Default exists under and as defined in the BankBoston Credit Agreement. 6. Financial Statements. As of the Effective Time, Section 4.13 of the Credit Agreement shall be deemed amended by deleting said Section 4.13 in its entirety and substituting the following new Section in its place: 4.13 Financial Statements. The Borrower has heretofore delivered to the Agent and the Lenders the selected historical consolidated financial information of New Plan and Excel and the pro-forma operating and financial information, balance sheets, statements of income and other financial information with respect to New Plan, Excel and the Borrower set forth in the Proxy Statement (the "Financial Statements"). The Financial Statements fairly present the Consolidated financial condition of the Borrower and its Subsidiaries as of the date of said financial statements and were true and correct in all material respects as of such date. Since the date of the Financial Statements, the Borrower and each Subsidiary has conducted its business only in the ordinary course and there has been no Material Adverse Change. 7. Legal Existence. As of the Effective Time, Section 7.3 of the Credit Agreement shall be deemed deleted and the following new Section 7.3 shall be inserted in its place: 7.3 Legal Existence. Maintain its status as a Maryland corporation in good standing in the State of Maryland and in each other jurisdiction in which the failure so to do could reasonably be expected to have a Material Adverse Effect. 4 5 8. Declaration of Trust. As of the Effective Time, all references to the "Declaration of Trust" in the Credit Agreement shall be deemed to refer, collectively, to the Charter and By-Laws of the Combined Company as they exist at such time. In furtherance of the foregoing, Section 8.7 of the Credit Agreement ("Declaration of Trust") shall be deemed deleted and the following new Section 8.7 shall be inserted in its place: 8.7 Charter and By-Laws. Amend or otherwise modify its Charter or By-Laws in any way (other than in connection with the issuance or classification of preferred stock of the Borrower) which would adversely affect the interests of the Agent and the Lenders under any of the Loan Documents, or permit any Subsidiary to amend its organizational documents in a manner which could have the same result. 9. Certain Prepayments. As of the Effective Time, Section 8.9 shall be deemed amended to add the following sentence at the end thereof: "Notwithstanding anything to the contrary set forth in this Section 8.9, prior to the occurrence of an Event of Default, the Borrower may prepay Indebtedness under the BankBoston Credit Agreement in accordance with Section 3 thereof, provided that no Event of Default would result from any such prepayment." 10. Additional Capital Stock of Subsidiaries. As of the Effective Time, Section 8.13 of the Credit Agreement shall be deemed amended to delete said Section 8.13 in its entirety and substitute in its place the following new Section 8.13: 8.13 Issuance of Additional Capital Stock by Subsidiaries. Permit any Subsidiary to issue any additional Stock or other equity interest of such Subsidiary, other than the issuance of partnership units in down-REIT partnership Subsidiaries of the Borrower, provided that such partnership units are issued (i) in the normal course of the Borrower's business and (ii) in consideration of the contribution to the down-REIT partnership of assets qualifying as "real estate assets" under Section 856(c) of the Code. 11. Minimum Tangible Net Worth. As of the Effective Time, Section 8.15 of the Credit Agreement shall be deemed amended to delete the number 5 6 "$550,000,000" therein and substitute in its place the following new number: "$1,200,000,000." 12. Maximum Total Indebtedness. As of the Effective Time, Section 8.16 of the Credit Agreement shall be deemed deleted and the following new Section 8.16 shall be substituted in its place: 8.16 Maximum Total Indebtedness. Permit either (i) the total indebtedness of the Borrower and its Subsidiaries, determined on a Consolidated basis, as determined in accordance with GAAP, at any time to be more than 50% of Total Capital at such time, or (ii) the indebtedness of the Borrower and its Subsidiaries, determined on a Consolidated basis, secured by mortgages on Real Property owned by the Borrower and its Subsidiaries at any time to exceed 40% of Total Capital at such time. 13. Defaults. As of the Effective Time Section 9.1 of the Credit Agreement shall be deemed amended in the following respects: (i) subsection (k) thereof shall be deemed amended to delete therefrom the number "$500,000" and substitute in its place the number "$1,000,000"; and (ii) the period at the end of subsection (o) shall be deemed deleted, the phrase "; or" shall be deemed inserted in its place, and the following new subsections (p) and (q) shall be deemed added at the end of said Section 9.1: (p) The Guarantor shall fail to comply with any covenant made by it in the Guaranty or if at any time any representation or warranty made by the Guarantor in the Guaranty or in any other document, statement or writing made to the Agent or the Lenders shall be incorrect or misleading in any material respect when made, or (ii) if a default by the Guarantor shall occur under the Guaranty after the expiration of any applicable notice and grace period; or (iii) if the Guarantor shall revoke or attempt to revoke, contest, commence any action or raise any defense (other than the defense of payment) against its obligations under the Guaranty; or (q) There shall occur an Event of Default under and as defined in the BankBoston Credit Agreement. 14. Notice Provision. Section 11.2 of the Credit Agreement is hereby amended to change the addresses for notices to the Agent as follows: 6 7 if to the Agent: The Bank of New York One Wall Street Agency Function Administration 18th floor New York, New York Attention: William Fahey Vice President Agency Function Administrator Telephone: (212) 635-4690 Telecopy: (212) 635-6365 or 6366 or 6367 with a copy to: The Bank of New York One Wall Street - 21st Floor New York, New York 10286 Attention: Andrea Stuart Vice President Telephone: (212) 635-4672 Telecopier: (212) 635-7904 15. Fiscal Year. The Agent and the Lenders acknowledge that as of the Effective Time, the fiscal year of the Combined Company and New Plan shall be a calendar year. 16. Conditions to the Effectiveness of this Amendment. The effectiveness of this Amendment, including without limitation, the waivers set forth in Section 1 hereof, are subject to the satisfaction of each of the following conditions on or before October 31, 1998 (the "Compliance Date"): (a) The Effective Time shall have occurred on or before the Compliance Date; (b) Prior to the Effective Time, the Agent shall have received this Amendment duly executed and delivered by the Borrower, the Agent and the Lenders, in sufficient copies for each Lender and the Agent to receive an original thereof; 7 8 (c) Prior to the Effective Time, the Agent shall have received such financial information with respect to Excel, New Plan and the Combined Company as the Agent or any of the Lenders shall have reasonably requested; (d) As of the Effective Time, the Agent shall have received: (i) a copy of the Articles of Merger and Certificate of Amendment and Merger (as defined in the Merger Agreement) duly executed by the required parties, certified by the Combined Company to be true and correct and in the form submitted for filing with the State Department of Assessments and Taxation of Maryland and the Secretary of State for the Commonwealth of Massachusetts, respectively; (ii) a certificate, dated the date of the Effective Time, of the Secretary or Assistant Secretary of the Combined Company (i) attaching a true and complete copy of the authorizing resolutions and of all documents evidencing other necessary action (in form and substance reasonably satisfactory to the Agent) taken by it to authorize the Assumption Agreement (hereinafter defined) and the incurrence of the obligations under the Credit Agreement and the other Loan Documents and the transactions contemplated thereby, (ii) attaching a true and complete copy of its Charter and By-Laws, and (iii) setting forth the incumbency of its officer or officers who may sign the Assumption Agreement, including therein a signature specimen of such officer or officers. (iii) for each Lender, a new Note in the form of Exhibit G to the Credit Agreement made payable to the order of each Lender and in the amount of each such Lender's Commitment Amount, duly executed by the Combined Company and dated as of the Effective Time; (iv) the Assumption and Substitution Agreement in the form of Attachment 1 hereto (the "Assumption Agreement") duly executed by the Combined Company, New Plan, the Agent and the Lenders and dated as of the Effective Time, in sufficient copies for each Lender and the Agent to receive an original thereof; and 8 9 (v) the Guaranty in the form of Attachment 2 hereto duly executed by New Plan and dated as of the Effective Time, in sufficient copies for each Lender and the Agent to receive an original thereof. 1. Opinion. Notwithstanding anything in the Credit Agreement to the contrary, the Lenders shall have no obligation to make any loan after the Effective Time until the Agent shall have received an opinion of counsel to the Combined Company in form satisfactory to the Agent covering such matters as the Agent may require, including opinions as to the consummation of the Merger in accordance with the Merger Agreement and the Proxy Statement and the authorization, execution and delivery and enforceability of the Assumption and Substitution Agreement. 2. No Other Amendments. Except to the extent amended hereby, all terms, provisions and conditions of the Credit Agreement shall continue in full force and effect and shall remain enforceable and binding in accordance with its terms. 3. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York. 4. Counterparts. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same document, and each party hereto may execute this Amendment by signing any of such counterparts. 5. Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. 6. Trust Limitation. This Amendment and all documents, agreements, understandings and arrangements relating to this transaction have been negotiated, executed and delivered on behalf of the Borrower by the trustees or officers thereof in their representative capacity under the Declaration of Trust, and not individually, and bind only the trust estate of the Borrower, and no trustee, officer, employee, agent or shareholder of the Borrower shall be bound or held to any personal liability or responsibility in connection with the agreements, obligations and undertakings of the Borrower hereunder, and any person or entity dealing with the Borrower in connection therewith shall look only to the trust estate for the payment of any claim or for the performance of any agreement, obligation or undertaking thereunder. The Agent and 9 10 each Lender hereby acknowledge and agree that each agreement and other document executed by the Borrower in accordance with or in respect of this transaction shall be deemed and treated to include in all respects and for all purposes the foregoing exculpatory provision. 7. New Plan Acknowledgment and Agreement. New Plan acknowledges that the Lenders are entering into this Amendment on the understanding that the terms hereof will be acceptable to the Combined Company and that the Combined Company will execute the Assumption Agreement as of the Effective Time. New Plan represents that the terms of this Amendment and the Attachments hereto are acceptable to the board of directors of New Plan, and New Plan agrees to cause the Combined Company to execute the Assumption Agreement on the Effective Time and deliver the executed counterpart thereof to the Agent. 10 11 IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Waiver and Amendment to Credit Agreement as of the date first above written. NEW PLAN REALTY TRUST By: /s/ DEAN BERNSTEIN ------------------------ Dean Bernstein Vice President THE BANK OF NEW YORK, as the Agent and a Lender By: /s/ ANDREA STUART ------------------------- Andrea Stuart Vice President FLEET NATIONAL BANK as a Lender By: /s/ THOMAS T. HANOLD ------------------------- Name: Thomas T. Hanold Title: Vice President 12 BANK HAPOALIM, B.M. as a Lender By: /s/ SHAUN BREIDBART --------------------------- Name: Shaun Breidbart Title: Vice President By: /s/ CONRAD WAGNER --------------------------- Name: Conrad Wagner Title: First Vice President EX-10.4 5 ASSUMPTION AND SUBSTITUTION AGREEMENT 1 Exhibit 10.4 ASSUMPTION AND SUBSTITUTION AGREEMENT ASSUMPTION AND SUBSTITUTION AGREEMENT, dated as of September 28, 1998, made by NEW PLAN EXCEL REALTY TRUST, INC. (the "Company"), NEW PLAN REALTY TRUST ("New Plan"), THE BANK OF NEW YORK ("BNY"), as Agent under the hereinafter defined Credit Agreement and the Lenders under the Credit Agreement (defined terms used herein which are not otherwise defined herein shall have the meaning ascribed to such terms in the Credit Agreement). RECITALS: A. BNY, as Agent, New Plan, as the Borrower and certain financial institutions entered into that certain Credit Agreement, dated as of November 21, 1997 (as amended, the "Credit Agreement"). B. New Plan entered into that certain Agreement and Plan of Merger among New Plan, Excel Realty Trust, Inc. ("Excel"), and ERT Merger Sub, Inc. ("Merger Sub"), dated May 14, 1998, as amended by that certain Amendment to Agreement and Plan of Merger, dated as of August 7, 1998, among the Borrower, Excel and the Merger Sub (collectively, the "Merger Agreement"). C. The Effective Time under and as defined in the Merger Agreement (the "Effective Time") has occurred in accordance with the Merger Agreement and the Joint Proxy Statement/Prospectus of New Plan and Excel dated August 12, 1998 (the "Proxy Statement"). D. New Plan and the Company have requested that the Company be substituted for New Plan as the Borrower under the Credit Agreement, and that the Company assume all of the obligations of New Plan under the Credit Agreement from and after the Effective Time. E. The Agent and the Lenders are agreeable to such request. NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company, represents, warrants and agrees as follows: 2 1. Representations. The Company hereby represents that as of the date hereof: (i) shares of beneficial interest of New Plan have been converted into the right to receive common shares of the stock of the Company, (ii) the Merger Sub has been merged with and into New Plan, with New Plan surviving as a wholly owned subsidiary of the Company, (iii) Excel and New Plan have filed Articles of Merger and a Certificate of Amendment and Merger (the collectively, "Merger Certificates") with the appropriate authorities in the State of Maryland and Commonwealth of Massachusetts to effect the merger contemplated by the Merger Agreement (the "Merger"), and (iv) pursuant to the Merger, Excel has changed its name to "New Plan Excel Realty Trust, Inc.," all as more particularly described in the Merger Agreement and the Proxy Statement. The Company hereby further represents that as of the date hereof, the copies of the Merger Certificates attached hereto as Exhibit 1 are true and correct copies thereof, and to the best knowledge of the Company there is no Default or Event of Default under the Credit Agreement. New Plan represents to the Agent, the Lenders and the Company that as of the date hereof there is no Default or Event of Default under the Credit Agreement. 2. Assumption. The Company hereby assumes all of the obligations of New Plan under the Credit Agreement and the other Loan Documents and agrees to be bound by all of the terms and provisions thereof as the Borrower thereunder, and agrees that it is, and shall continue to be, liable for all of the obligations of New Plan under the Credit Agreement and the other Loan Documents. The Company has no right of set off, claim or counterclaim under the Credit Agreement or any such Loan Documents. 3. Commitments of the Lenders. The Lenders agree that each of their Commitments under the Credit Agreement continues to be in full force and effect. The Agent confirms (for the benefit of the Company, without waiving any of its rights) that as of the date hereof, it has not issued a written notice of default to New Plan with respect to its obligations under the Credit Agreement. The Company acknowledges and agrees that all conditions to the obligations of the Lenders to make Loans under their respective Commitments are unchanged and continue as conditions precedent to the obligations of the Lenders to make any Loans. 4. Substitution. The parties hereto agree that the Company is hereby substituted for New Plan as the Borrower under the Credit Agreement, and that, effective as of the Effective Time, New Plan shall cease to be a borrower under the Credit Agreement and shall have no further rights under the Credit Agreement or the other Loan Documents, (but New Plan shall be obligated under the Guaranty for all 2 3 obligations of the Company as the Borrower under the Credit Agreement and the other Loan Documents). 5. Credit Agreement Schedules. The Credit Agreement is hereby amended to delete therefrom Schedules 4.1, 4.5, 4.12, 8.3 and 8.4 and substitute in their place the new Schedules 4.1, 4.5, 4.12, 8.3 and 8.4 attached hereto. 6. Successors and Assigns. This Assumption Agreement shall inure to the benefit of the Agent, each of the Lenders, the Company and New Plan and their successors and assigns, except that neither the Company nor New Plan may assign, delegate or transfer any of its rights or obligations under this Assumption Agreement, of any other Loan Document without the prior written consent of the Agent and each Lender. 7. WAIVER OF TRIAL BY JURY. THE PARTIES HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THE THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN AND THEREIN, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. FURTHER, THE PARTIES HERETO HEREBY CERTIFY THAT NO REPRESENTATIVE OF THE AGENT OR ANY LENDER, OR COUNSEL TO THE AGENT OR ANY LENDER, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE AGENT OR SUCH LENDER WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS PROVISION. THE PROVISIONS OF THIS SECTION CONSTITUTE A MATERIAL INDUCEMENT TO THE AGENT AND THE LENDERS TO ACCEPT THIS AGREEMENT. 8. Governing Law. This Agreement and the rights and obligations of the parties hereunder shall be construed, enforced, and interpreted according to the laws of the State of New York applicable to contracts made in and performed in the State of New York. 9. Fees and Expenses. The Company and New Plan agree to pay the reasonable out of pocket fees and expenses of the Agent (including the fees of counsel to the Agent) in connection with the preparation, negotiation and execution of this Agreement. 3 4 10. Counterparts. This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. A set of counterparts executed by all the parties hereto shall be lodged with the Agent. 11. Trust Limitation. This Agreement and all documents, agreements, understandings and arrangements relating to this transaction have been negotiated, executed and delivered on behalf of New Plan by the trustees or officers thereof in their representative capacity under the Declaration of Trust, and not individually, and bind only the trust estate of New Plan, and no trustee, officer, employee, agent or shareholder of New Plan shall be bound or held to any personal liability or responsibility in connection with the agreements, obligations and undertakings of New Plan hereunder, and any person or entity dealing with New Plan in connection therewith shall look only to the trust estate for the payment of any claim or for the performance of any agreement, obligation or undertaking thereunder. The Agent and each Lender hereby acknowledge and agree that each agreement and other document executed by New Plan in accordance with or in respect of this transaction shall be deemed and treated to include in all respects and for all purposes the foregoing exculpatory provision. 4 5 IN WITNESS WHEREOF, the parties hereto have executed this Assumption Agreement as of the day and year first set forth above. NEW PLAN EXCEL REALTY TRUST, INC. By: /s/ DEAN BERNSTEIN ------------------------ Name: Dean Bernstein Title: Senior Vice President THE BANK OF NEW YORK As Agent and a Lender By: /s/ ANDREA STUART ------------------------ Andrea Stuart Vice President FLEET NATIONAL BANK as a Lender By: /s/ THOMAS T. HANOLD ------------------------ Name: Thomas T. Hanold Title: Vice President 6 BANK HAPOALIM, B.M. as a Lender By: /s/ SHAUN BREIDBART ------------------------ Name: Shaun Breidbart Title: Vice President By: /s/ CONRAD WAGNER ------------------------ Name: Conrad Wagner Title: First Vice President NEW PLAN REALTY TRUST As withdrawing Borrower By: /s/ DEAN BERNSTEIN ------------------------ Name: Dean Bernstein Title: Senior Vice President EX-10.5 6 UNCONDITIONAL GUARANTY OF PAYMENT & PERFORMANCE 1 Exhibit 10.5 UNCONDITIONAL GUARANTY OF PAYMENT AND PERFORMANCE FOR AND IN CONSIDERATION OF the sum of Ten and No/100 Dollars ($10.00) and other good and valuable consideration paid or delivered to the undersigned NEW PLAN REALTY TRUST, a Massachusetts business trust (hereinafter referred to as "Guarantor"), the receipt and sufficiency whereof are hereby acknowledged by Guarantor, and for the purpose of seeking to induce BANKBOSTON, N.A., a national banking association (hereinafter referred to as "Lender", which term shall also include each other Bank which may now be or hereafter become a party to the "Credit Agreement" (as hereinafter defined) and shall also include any such individual Bank acting as agent for all of the Banks), to consent to the merger of ERT Merger Sub, Inc., a Maryland corporation, with New Plan Realty Trust, a Massachusetts business trust, as required by the Credit Agreement and to extend credit or otherwise provide financial accommodations to NEW PLAN EXCEL REALTY TRUST, INC. (formerly known as Excel Realty Trust, Inc.), a Maryland corporation (hereinafter referred to as "Borrower"), which extension of credit and provision of financial accommodations will be to the direct interest, advantage and benefit of Guarantor, Guarantor does hereby absolutely, unconditionally and irrevocably guarantee to Lender: (a) the full and prompt payment when due, whether by acceleration or otherwise, either before or after maturity thereof, of (i) that certain Revolving Credit Note dated as of May 27, 1998, made by Borrower to the order of BKB in the principal face amount of Thirty Million and No/100 Dollars ($30,000,000.00) and that certain Swing Loan Note dated as of March 31, 1998, made by Borrower to the order of BKB in the principal face amount of Ten Million and No/100 Dollars ($10,000,000.00) (hereinafter referred to collectively as the "BKB Note"), and (ii) those certain Revolving Credit Notes (hereinafter referred to as the "Additional Notes") dated various dates, made by Borrower to the order of the Banks (other than BKB) in the aggregate principal face amount of Two Hundred Twenty Million and No/100 Dollars ($220,000,000.00), together with interest as provided in the BKB Note and the Additional Notes and together with any replacements, supplements, renewals, modifications, consolidations, restatements and extensions thereof; and (b) the full and prompt payment when due, whether by acceleration or otherwise, either before or after maturity thereof, of each other note as may be issued under that certain First Amended and Restated Revolving Credit Agreement dated as of March 31, 1998 among Borrower and BKB, for itself and as agent, and the other lenders now or hereafter a party thereto, as amended by that certain First Amendment to Amended and Restated Revolving Credit Agreement dated of even date herewith (hereinafter referred to as the "Credit Agreement") together with interest as provided in each such note, together with any replacements, supplements, renewals, modifications, consolidations, restatements and extensions thereof (the BKB Note, the Additional Notes and each of the notes described in this subparagraph (b) is hereinafter referred to collectively as the "Note"); and 2 (c) the full and prompt payment and performance of all obligations of Borrower to Lender under the terms of the Credit Agreement, including, without limitation, the obligations of Borrower concerning hazardous materials contained in Section 8.6 of the Credit Agreement, together with any replacements, supplements, renewals, modifications, consolidations, restatements and extensions thereof; and (d) the full and prompt payment and performance of any and all other obligations of Borrower to Lender under any other agreements, documents or instruments now or hereafter evidencing, securing or otherwise relating to the indebtedness evidenced by the Note or the Credit Agreement (the Note, the Credit Agreement and said other agreements, documents and instruments are hereinafter collectively referred to as the "Loan Documents" and individually referred to as a "Loan Document"); provided, however, the liability of Guarantor hereunder shall not exceed the Maximum Amount for Guarantor. As used herein, the term "Maximum Amount" means with respect to Guarantor, the greater of (i) 95% of the greater of (A) the Asset Value of all Unencumbered Operating Properties from time to time owned by Guarantor or (B) the Debt Service Coverage Amount for all Unencumbered Operating Properties from time to time owned by Guarantor or (ii) 95% of the difference, from time to time, of (a) the fair saleable value of the properties of Guarantor minus (b) the total liabilities of Guarantor (including the probable liabilities on contingent or unliquidated obligations, but excluding the obligations of Guarantor hereunder). Upon any transfer of an Unencumbered Operating Property from one person liable with respect to the obligations guaranteed hereunder to another person liable with respect to the obligations guaranteed hereunder, the consideration given in connection with such transfer shall be deemed to include associated increase in the Maximum Amount of the transferee and decrease in the Maximum Amount of the transferor. All terms used herein and not otherwise defined herein shall have the meanings set forth in the Credit Agreement. 1. Agreement to Pay and Perform; Costs of Collection. Guarantor does hereby agree that if the Note is not paid by Borrower in accordance with its terms, or if any and all sums which are now or may hereafter become due from Borrower to Lender under the Loan Documents are not paid by Borrower in accordance with their terms, or if any and all other obligations of Borrower to Lender under the Note and the Loan Documents are not performed by Borrower in accordance with their terms, Guarantor will immediately make such payments and perform such obligations. Guarantor further agrees to pay Lender on demand all reasonable costs and expenses (including court costs and reasonable attorneys' fees and disbursements) paid or incurred by Lender in endeavoring to collect the indebtedness guaranteed hereby, to enforce any of the other obligations of Borrower guaranteed hereby, or any portion thereof, or to enforce this Guaranty, and until paid to Lender, such sums shall bear interest at the default rate set forth in the Credit Agreement unless collection from Guarantor of interest at such rate would be contrary to -2- 3 applicable law, in which event such sums shall bear interest at the highest rate which may be collected from Guarantor under applicable law. 2. Reinstatement of Refunded Payments. If, for any reason, any payment to Lender of any of the obligations guaranteed hereunder is required to be refunded by Lender to Borrower, or paid or turned over to any other person, including, without limitation, by reason of the operation of bankruptcy, reorganization, receivership or insolvency laws or similar laws of general application relating to creditors' rights and remedies now or hereafter enacted, Guarantor agrees to pay the amount so required to be refunded, paid or turned over (the "Turnover Payment"), the obligations of Guarantor shall not be treated as having been discharged by the original payment to Lender giving rise to the Turnover Payment, and this Guaranty shall be treated as having remained in full force and effect for any such Turnover Payment so made by Lender, as well as for any amounts not theretofore paid to Lender on account of such obligations. 3. Rights of Lender to Deal with Collateral, Borrower and Other Persons. Guarantor hereby consents and agrees that Lender may at any time, and from time to time, without thereby releasing Guarantor from any liability hereunder and without notice to or further consent from any other Person, either with or without consideration: release or surrender any lien or other security of any kind or nature whatsoever held by it or by any person, firm or corporation on its behalf or for its account, securing any indebtedness or liability hereby guaranteed; substitute for any collateral so held by it, other collateral of like kind, or of any kind; modify the terms of the Note or the Loan Documents; extend or renew the Note for any period; grant releases, compromises and indulgences with respect to the Note or the Loan Documents and to any persons or entities now or hereafter liable thereunder or hereunder; release any other guarantor, surety, endorser or accommodation party of the Note or any other Loan Documents; or take or fail to take any action of any type whatsoever. No such action which Lender shall take or fail to take in connection with the Note or the Loan Documents, or any of them, or any security for the payment of the indebtedness of Borrower to Lender or for the performance of any obligations or undertakings of Borrower, nor any course of dealing with Borrower or any other person, shall release Guarantor's obligations hereunder, affect this Guaranty in any way or afford Guarantor any recourse against Lender. The provisions of this Guaranty shall extend and be applicable to all replacements, supplements, renewals, amendments, extensions, consolidations, restatements and modifications of the Note and the Loan Documents, and any and all references herein to the Note and the Loan Documents shall be deemed to include any such replacements, supplements, renewals, extensions, amendments, consolidations, restatements or modifications thereof. Without limiting the generality of the foregoing, Guarantor acknowledges the terms of Section 18.3 of the Credit Agreement and agrees that this Guaranty shall extend and be applicable to each new or replacement note delivered by Borrower pursuant thereto without notice to or further consent from Guarantor. 4. No Contest with Lender; Subordination. So long as any obligation hereby guaranteed remains unpaid or undischarged, Guarantor will not, by paying any sum recoverable hereunder (whether or not demanded by Lender) or by any means or on any other ground, claim any set-off or counterclaim against Borrower in respect of any liability of Guarantor to Borrower -3- 4 or, in proceedings under federal bankruptcy law or insolvency proceedings of any nature, prove in competition with Lender in respect of any payment hereunder or be entitled to have the benefit of any counterclaim or proof of claim or dividend or payment by or on behalf of Borrower or the benefit of any other security for any obligation hereby guaranteed which, now or hereafter, Lender may hold or in which it may have any share. Guarantor hereby expressly waives any right of contribution from or indemnity against Borrower, whether at law or in equity, arising from any payments made by Guarantor pursuant to the terms of this Guaranty, and Guarantor acknowledges that Guarantor has no right whatsoever to proceed against Borrower for reimbursement of any such payments. In connection with the foregoing, Guarantor expressly waives any and all rights of subrogation to Lender against Borrower, and Guarantor hereby waives any rights to enforce any remedy which Lender may have against Borrower and any rights to participate in any collateral for Borrower's obligations under the Loan Documents. Guarantor hereby subordinates any and all indebtedness of Borrower now or hereafter owed to Guarantor to all indebtedness of Borrower to Lender, and agrees with Lender that (a) Guarantor shall not demand or accept any payment from Borrower on account of such indebtedness, (b) Guarantor shall not claim any offset or other reduction of Guarantor's obligations hereunder because of any such indebtedness, and (c) Guarantor shall not take any action to obtain any interest in any of the security described in and encumbered by the Loan Documents because of any such indebtedness; provided, however, that, if Lender so requests, such indebtedness shall be collected, enforced and received by Guarantor as trustee for Lender and be paid over to Lender on account of the indebtedness of Borrower to Lender, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty except to the extent the principal amount of such outstanding indebtedness shall have been reduced by such payment. 5. Waiver of Defenses. Guarantor hereby agrees that its obligations hereunder shall not be affected or impaired by, and hereby waives and agrees not to assert or take advantage of any defense based on: (a) any statute of limitations in any action hereunder or for the collection of the Note or for the payment or performance of any obligation hereby guaranteed; (b) the incapacity, lack of authority, death or disability of Borrower or any other person or entity, or the failure of Lender to file or enforce a claim against the estate (either in administration, bankruptcy or in any other proceeding) of Borrower or Guarantor or any other person or entity; (c) the dissolution or termination of existence of Borrower or Guarantor or any other Person; (d) the voluntary or involuntary liquidation, sale or other disposition of all or substantially all of the assets of Borrower; -4- 5 (e) the voluntary or involuntary receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, assignment, composition, or readjustment of, or any similar proceeding affecting, Borrower or Guarantor, or of Borrower's or any Guarantor's properties or assets; (f) the damage, destruction, condemnation, foreclosure or surrender of all or any part of the Real Estate or any of the improvements located thereon; (g) the failure of Lender to give notice of the existence, creation or incurring of any new or additional indebtedness or obligation or of any action or nonaction on the part of any other person whomsoever in connection with any obligation hereby guaranteed; (h) any failure or delay of Lender to commence an action against Borrower, to assert or enforce any remedies against Borrower under the Note or the Loan Documents, or to realize upon any security; (i) any failure of any duty on the part of Lender to disclose to Guarantor any facts it may now or hereafter know regarding Borrower, the Real Estate or any of the improvements located thereon, whether such facts materially increase the risk to Guarantor or not; (j) failure to accept or give notice of acceptance of this Guaranty by Lender; (k) failure to make or give notice of presentment and demand for payment of any of the indebtedness or performance of any of the obligations hereby guaranteed; (l) failure to make or give protest and notice of dishonor or of default to Guarantor or to any other party with respect to the indebtedness or performance of obligations hereby guaranteed; (m) except as otherwise specifically provided in this Guaranty, any and all other notices whatsoever to which Guarantor might otherwise be entitled; (n) any lack of diligence by Lender in collection, protection or realization upon any collateral securing the payment of the indebtedness or performance of obligations hereby guaranteed; (o) the invalidity or unenforceability of the Note or any of the Loan Documents; (p) the compromise, settlement, release or termination of any or all of the obligations of Borrower under the Note or the Loan Documents; -5- 6 (q) any transfer by Borrower or any other Person of all or any part of the security encumbered by the Loan Documents; (r) the failure of Lender to perfect any security or to extend or renew the perfection of any security; or (s) to the fullest extent permitted by law, any other legal, equitable or surety defenses whatsoever to which Guarantor might otherwise be entitled, it being the intention that the obligations of Guarantor hereunder are absolute, unconditional and irrevocable. 6. Guaranty of Payment and Performance and Not of Collection. This is a Guaranty of payment and performance and not of collection. The liability of Guarantor under this Guaranty shall be primary, direct and immediate and not conditional or contingent upon the pursuit of any remedies against Borrower or any other person, nor against securities or liens available to Lender, its successors, successors in title, endorsees or assigns. Guarantor hereby waives any right to require that an action be brought against Borrower or any other person or to require that resort be had to any security or to any balance of any deposit account or credit on the books of Lender in favor of Borrower or any other person. 7. Rights and Remedies of Lender. In the event of a default under the Note or the Loan Documents, or any of them, Lender shall have the right to enforce its rights, powers and remedies thereunder or hereunder or under any other agreement, document or instrument now or hereafter evidencing, securing or otherwise relating to the indebtedness evidenced by the Note or secured by the Loan Documents, in any order, and all rights, powers and remedies available to Lender in such event shall be nonexclusive and cumulative of all other rights, powers and remedies provided thereunder or hereunder or by law or in equity. Accordingly, Guarantor hereby authorizes and empowers Lender upon the occurrence of any event of default under the Note or the Loan Documents, at its sole discretion, and without notice to Guarantor, to exercise any right or remedy which Lender may have, including, but not limited to, judicial foreclosure, exercise of rights of power of sale, acceptance of a deed or assignment in lieu of foreclosure, appointment of a receiver to collect rents and profits, exercise of remedies against personal property, or enforcement of any assignment of leases, as to any security, whether real, personal or intangible. At any public or private sale of any security or collateral for any indebtedness or any part thereof guaranteed hereby, whether by foreclosure or otherwise, Lender may, in its discretion, purchase all or any part of such security or collateral so sold or offered for sale for its own account and may apply against the amount bid therefor all or any part of the balance due it pursuant to the terms of the Note or any other Loan Document without prejudice to Lender's remedies hereunder against Guarantor for deficiencies. If the indebtedness guaranteed hereby is partially paid by reason of the election of Lender to pursue any of the remedies available to Lender, or if such indebtedness is otherwise partially paid, this Guaranty shall nevertheless remain in full force and effect, and Guarantor shall remain liable for the entire balance of the indebtedness guaranteed hereby even though any rights which Guarantor may have against Borrower may be destroyed or diminished by the exercise of any such remedy. -6- 7 8. Application of Payments. Guarantor hereby authorizes Lender, without notice to Guarantor, to apply all payments and credits received from Borrower or from Guarantor or realized from any security in such manner and in such priority as Lender in its sole judgment shall see fit to the indebtedness, obligation and undertakings which are the subject of this Guaranty. 9. Business Failure, Bankruptcy or Insolvency. In the event of the business failure of Guarantor or if there shall be pending any bankruptcy or insolvency case or proceeding with respect to Guarantor under federal bankruptcy law or any other applicable law or in connection with the insolvency of Guarantor, or if a liquidator, receiver, or trustee shall have been appointed for Guarantor or Guarantor's properties or assets, Lender may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of Lender allowed in any proceedings relative to Guarantor, or any of Guarantor's properties or assets, and, irrespective of whether the indebtedness or other obligations of Borrower guaranteed hereby shall then be due and payable, by declaration or otherwise, Lender shall be entitled and empowered to file and prove a claim for the whole amount of any sums or sums owing with respect to the indebtedness or other obligations of Borrower guaranteed hereby, and to collect and receive any moneys or other property payable or deliverable on any such claim. Guarantor covenants and agrees that upon the commencement of a voluntary or involuntary bankruptcy proceeding by or against Borrower, Guarantor shall not seek a supplemental stay or otherwise pursuant to 11 U.S.C. Section 105 or any other provision of the Bankruptcy Reform Act of 1978, as amended, or any other debtor relief law (whether statutory, common law, case law, or otherwise) of any jurisdiction whatsoever, now or hereafter in effect, which may be or become applicable, to stay, interdict, condition, reduce or inhibit the ability of Lender to enforce any rights of Lender against Guarantor by virtue of this Guaranty or otherwise. 10. Financial Statements and Other Information. Guarantor hereby represents and warrants to Lender that all financial statements of Guarantor and its Subsidiaries heretofore delivered by Guarantor to Lender are true and correct in all material respects, have been prepared in accordance with generally accepted accounting principles consistently applied, and fairly present the financial condition of Guarantor and its Subsidiaries as at the close of business on the date thereof and the results of operations for the period then ended; that no material adverse change has occurred in the assets, liabilities, financial condition or business of Guarantor and its Subsidiaries as shown or reflected therein since the date thereof; and that Guarantor and its Subsidiaries have no liabilities or known contingent liabilities involving material amounts which are not reflected in such financial statements or referred to in the notes thereto other than Guarantor's obligations under this Guaranty. Guarantor hereby agrees that until all indebtedness guaranteed hereby has been completely repaid, all obligations and undertakings of Borrower under, by reason of, or pursuant to the Note and the Loan Documents have been completely performed and Lender has no further obligation to make Loans to Borrower pursuant to the Credit Agreement, Guarantor will deliver to Lender: -7- 8 (a) as soon as practicable and in any event within 90 days after the end of each fiscal year of Guarantor, copies of the unaudited consolidated balance sheet of Guarantor and its Subsidiaries as of the end of such fiscal year, and the related unaudited consolidated statement of operations and statement of cash flows for such fiscal year, all in reasonable detail and prepared in accordance with generally accepted accounting principals, together with a certificate by the principal financial or accounting officer of Guarantor that the information contained in such financial statements fairly presents the financial portion of Guarantor on the date thereof; (b) contemporaneously with the delivery of the financial statements referred to in clause (a) above, a statement of all contingent liabilities of Guarantor and its Subsidiaries which are not reflected in such financial statements or referred to in the notes thereto (including, without limitation, all guarantees, endorsements and other contingent obligations in respect of indebtedness of others, and obligations to reimburse the issuer in respect of any letters of credit), all in reasonable detail and certified by the principal financial or accounting officer of Guarantor; (c) promptly after they are filed with the Internal Revenue Service, copies of all annual federal income tax returns and amendments thereto of Guarantor; (d) concurrently with the delivery of the financial statements described in clause (a) above, a certificate signed by the president or chief financial officer of Guarantor to the effect that, having read this Guaranty, and that based upon an examination which they deem sufficient to enable them to make an informed statement, there does not exist any Default or Event of Default, or if such Default or Event of Default has occurred, specifying the facts with respect thereto; (e) promptly upon becoming aware thereof, written notice from Guarantor of any event or condition which might have a material adverse effect on the business, operations, assets, condition (financial or otherwise) or prospects of Guarantor or any of its Subsidiaries or the ability of Guarantor to perform under this Guaranty (including but not limited to, litigation commenced or threatened in writing against Guarantor or any of its Subsidiaries, judgments rendered against Guarantor or any of its Subsidiaries, liens filed against any property of Guarantor, defaults claimed under indebtedness for borrowed money for which Guarantor or any of its Subsidiaries is primarily or secondarily liable, or bankruptcy, insolvency or trustee or receivership proceedings commenced against Guarantor or any of its Subsidiaries), such notice to specify the nature and the period of existence of such event or condition, the anticipated effect thereof, and what action Guarantor is taking or proposes to take with respect thereto; and (f) with reasonable promptness, such other information respecting the business, operations, assets, liabilities and financial condition of Guarantor and its Subsidiaries as Lender may from time to time reasonably request. Without limiting the foregoing, Lender may require that Guarantor deliver to Lender financial information concerning Guarantor and its -8- 9 Subsidiaries on a more frequent basis, including without limitation the delivery of unaudited quarterly financial statements. Guarantor will permit any officer designated by Lender, at Guarantor's expense, to visit and inspect any of the properties of Guarantor and its Subsidiaries, to examine the records and books of account of Guarantor and its Subsidiaries (and to make copies thereof and extracts therefrom) and to discuss the affairs, finances and accounts of Guarantor with, and to be advised as to the same by, its officers, all at such reasonable times and intervals Lender may reasonably request. 11. Covenants of Guarantor. Guarantor hereby covenants and agrees with Lender that until all indebtedness guaranteed hereby has been completely repaid, all obligations and undertakings of Borrower under, by reason of, or pursuant to the Note and the Loan Documents have been completely performed and Lender has no further obligation to make Loans to Borrower pursuant to the Credit Agreement: (a) Guarantor will, and will cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve and keep in full force and effect its corporate or legal existence, material rights and franchises, as applicable, to effect and maintain its foreign qualifications, licensing, domestication or authorization in each jurisdiction where the Unencumbered Operating Properties owned by it are located and in each other jurisdiction where a failure to be so qualified could have a materially adverse effect on the business, assets or financial condition of such person, and to comply with all applicable laws and regulations (including, without limitation, environmental laws); (b) Guarantor will, and will cause each of its Subsidiaries to, duly pay and discharge, before the same shall become in arrears, all taxes, assessments and other governmental charges imposed upon it and its properties, sales or activities, or upon the income or profits therefrom, as well as claims for labor, material, or supplies which if unpaid might become a lien or charge on any of its property; provided that any such tax, assessment, charge or claim need not be paid if the validity or amount thereof shall currently be contested in good faith by appropriate proceedings and if Guarantor or such Subsidiary shall have set aside on its books adequate reserves with respect thereto; and provided further that Guarantor or such Subsidiary shall pay all such taxes, assessments, charges and claims forthwith upon the commencement of proceedings to foreclose any lien that may have attached as security therefor; (c) Guarantor will, and will cause each of its Subsidiaries to, maintain and keep the properties used or deemed by it to be useful in its business in first-class repair, working order and condition, and make or cause to be made all necessary and proper repairs thereto and replacements thereof; (d) Guarantor will, and will cause each of its Subsidiaries to, maintain with financially sound and reputable insurers, insurance with respect to its properties and business -9- 10 against such casualties and contingencies and in such types and amounts as shall be in accordance with sound business practices for companies in similar business similarly situated; (e) Guarantor will keep, and will cause each of its Subsidiaries to keep, complete, proper and accurate records and books of account in which full, true and correct entries will be made in accordance with generally accepted accounting principles consistent with the preparation of the financial statements heretofore delivered to Lender and will maintain adequate accounts and reserves for all taxes (including income taxes), all depreciation, depletion, and amortization of its properties and the properties of its Subsidiaries, all other contingencies, and all other proper reserves; (f) Guarantor will not, and will not permit any of its Subsidiaries to, create, incur, assume, guarantee or be or remain liable, contingently or otherwise, with respect to any Indebtedness other than: (i) Indebtedness to Lender arising under any of the Note, the Loan Documents and this Guaranty; (ii) current liabilities of Guarantor incurred in the ordinary course of business but not incurred through the borrowing of money or the obtaining of credit except for credit on an open account basis customarily extended and in fact extended in connection with normal purchases of goods and services; (iii) Indebtedness in respect of taxes, assessments and governmental charges to the extent that payment therefor shall not at the time be required to be made in accordance with the provisions of subparagraph (b) of this paragraph; (iv) Indebtedness in respect of judgments or awards that have been in force for less than the applicable period for taking an appeal so long as execution is not levied thereunder or in respect of which Guarantor shall at the time in good faith be prosecuting an appeal or proceedings for review and in respect of which a stay of execution shall have been obtained pending such appeal or review; (v) endorsements for collection, deposit or negotiation and warranties of products or services, in each case incurred in the ordinary course of business; and (vi) Indebtedness permitted under Section8.1 of the Credit Agreement. (g) Guarantor will not, and will not permit any of its Subsidiaries to, create or incur or suffer to be created or incurred or to exist any Lien; provided that Guarantor and any Subsidiary of Guarantor may create or incur or suffer to be created or incurred or to exist: (i) liens to secure taxes, assessments and other governmental charges or claims for labor, material or supplies in respect of obligations not overdue; -10- 11 (ii) liens with respect of judgments or awards, the Indebtedness with respect to which is permitted by subparagraph (f)(iv) of this paragraph; (iii) liens in favor of Lender as security for the Obligations; and (iv) liens specifically permitted pursuant to Section 8.2 of the Credit Agreement; (h) Guarantor will not, and will not permit any of its Subsidiaries to, become a party to any merger, consolidation or other business combination, or agree to effect any asset acquisition, stock acquisition or other acquisition (except to the extent Borrower may do so under the Credit Agreement) without the prior written consent of the Majority Banks, which consent shall not be unreasonably withheld, except (i) the merger or consolidation of one or more of the Subsidiaries of Guarantor with and into Guarantor, or (ii) the merger or consolidation of two or more Subsidiaries of Guarantor; provided, however, that in no event shall the Borrower or Guarantor be merged, consolidated or combined with or into any Guarantor, any other guarantor or any Subsidiary thereof without the prior written consent of the Majority Banks; (i) Guarantor will not, and will not permit any of its Subsidiaries to, become a party to or agree to or affect any disposition of assets, other than the disposition of assets in the ordinary course of business (but subject to the terms of the Credit Agreement); (j) Subject to the terms of the Credit Agreement, Guarantor shall cause its Subsidiaries to operate their respective businesses as described in the Prospectus and in compliance with the terms and conditions of this Guaranty and the other Loan Documents; (k) Subject to subparagraph (l) of this paragraph, Guarantor shall promptly distribute to the Borrower (but not less frequently than once each fiscal quarter of the Borrower), whether in the form of dividends, distributions or otherwise, all profits, proceeds or other income relating to or arising from Guarantor's and its Subsidiaries' use, operation, financing, refinancing, sale or other disposition of their respective assets and properties after (a) the payment by Guarantor and each Subsidiary of its Debt Service and operating expenses for such quarter and (b) the establishment of reasonable reserves for the payment of operating expenses not paid on at least a quarterly basis and capital improvements to be made to Guarantor's or such Subsidiary's assets and properties approved by Guarantor or such Subsidiary in the ordinary course of business consistent with its past practices; (l) In the event that an Event of Default shall have occurred and be continuing, the Guarantor shall make no Distributions other than those expressly permitted by Section 8.7(b) of the Credit Agreement; (m) Guarantor shall at all times comply with all covenants and provisions of the Credit Agreement and the Loan Documents applicable to Guarantor; and -11- 12 (n) Guarantor will cooperate with Lender and execute such further instruments and documents as Lender shall reasonably request to carry out to their satisfaction the transactions contemplated by this Guaranty and the other Loan Documents. 12. Security and Rights of Set-off. Guarantor hereby grants to Lender, as security for the full and prompt payment and performance of Guarantor's obligations hereunder, a continuing lien on and security interest in any and all securities or other property belonging to Guarantor now or hereafter held by Lender and in any and all deposits (general or specific, time or demand, provisional or final, regardless of currency, maturity, or the branch of Lender where the deposits are held) now or hereafter held by Lender and other sums credited by or due from Lender to Guarantor or subject to withdrawal by Guarantor; and regardless of the adequacy of any collateral or other means of obtaining repayment of such obligations, during the continuance of any Event of Default under the Note or the Loan Documents, Lender may at any time and without notice to Guarantor set-off and apply the whole or any portion or portions of any or all such deposits and other sums against amounts payable under this Guaranty, whether or not any other person or persons could also withdraw money therefrom. Any security now or hereafter held by or for Guarantor and provided by Borrower, or by anyone on Borrower's behalf, in respect of liabilities of Guarantor hereunder shall be held in trust for Lender as security for the liabilities of Guarantor hereunder. 13. Changes in Writing; No Revocation. This Guaranty may not be changed orally, and no obligation of Guarantor can be released or waived by Lender except by a writing signed by a duly authorized officer of Lender. This Guaranty shall be irrevocable by Guarantor until all indebtedness guaranteed hereby has been completely repaid and all obligations and undertakings of Borrower under, by reason of, or pursuant to the Note and the Loan Documents have been completely performed and Borrower has no further rights to receive Loans under the Credit Agreement. 14. Notices. All notices, demands or requests provided for or permitted to be given pursuant to this Guaranty (hereinafter in this paragraph referred to as "Notice") must be in writing and shall be deemed to have been properly given or served by personal delivery or by sending same by overnight courier or by depositing the same in the United States mail, postpaid and registered or certified, return receipt requested, at the addresses set forth below. Each Notice shall be effective upon being delivered personally or upon being sent by overnight courier or upon being deposited in the United States Mail as aforesaid. The time period in which a response to any such Notice must be given or any action taken with respect thereto, however, shall commence to run from the date of receipt if personally delivered or sent by overnight courier or, if so deposited in the United States Mail, the earlier of three (3) Business Days following such deposit and the date of receipt as disclosed on the return receipt. Rejection or other refusal to accept or the inability to deliver because of changed address of which no Notice was given shall be deemed to be receipt of the Notice sent. By giving at least fifteen (15) days prior Notice thereof, Guarantor or Lender shall have the right from time to time and at any time during the term of this Guaranty to change their respective addresses and each shall have the -12- 13 right to specify as its address any other address within the United States of America. For the purposes of this Guaranty: The address of Lender is: BankBoston, N.A. 100 Federal Street Boston, Massachusetts 02110 Attn: Real Estate Division with a copy to: BankBoston, N.A. 115 Perimeter Center Place, N.E. Suite 500 Atlanta, Georgia 30346 Attn: Jeffrey L. Warwick and a copy to each other Lender which may now or hereafter become a party to the Credit Agreement at such address as may be designated by such Lender. The address of Guarantor is: With a copy to: New Plan Realty Trust New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas 16955 Via Del Campo, Suite 110 New York, New York 10036 San Diego, California 92127 Attn: Chief Financial Officer Attn: Chief Financial Officer 15. GOVERNING LAW. GUARANTOR ACKNOWLEDGES AND AGREES THAT THIS GUARANTY AND THE OBLIGATIONS OF GUARANTOR HEREUNDER SHALL BE GOVERNED BY AND INTERPRETED AND DETERMINED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). If, notwithstanding the provisions of Section 15 above, this Guaranty is deemed to be governed by California law, then the following shall apply but shall not in any way limit the generality of any other provisions contained in this Guaranty. Guarantor hereby waives (a) any defense of Guarantor based upon Lender's election of any remedy against Guarantor or Borrower or both; (b) any defense based upon Lender's failure to disclose to Guarantor any information concerning Borrower's financial condition or any other circumstances bearing on Borrower's ability to pay all sums payable under the Loan Documents; -13- 14 (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal; (d) any defense based upon Lender's election, in any proceeding instituted under the Federal Bankruptcy Code, of the application of Section 1111(b)(2) of the Federal Bankruptcy Code or any successor statute; (e) any right of subrogation, any right to enforce any remedy which Lender may have against Borrower and any right to participate in, or benefit from, any security for any of the Loan Documents now or hereafter held by Lender; and (f) benefit of any statute of limitations affecting the liability of Guarantor hereunder or the enforcement hereof. Without limiting the generality of the foregoing or any other provision hereof, Guarantor expressly waives any and all benefits which might otherwise be available to Guarantor under Sections 2787 to 2855, inclusive, of the California Civil Code, including without limitation, Sections 2809, 2810, 2819, 2839, 2845, 2849 and 2850, and all benefits which might otherwise be available to Guarantor under Sections 2899 and 3433 of the California Civil Code and the California Code of Civil Procedure Sections 580a, 580b, 580d and 726, or any of such sections. Furthermore, without limitation of any waiver otherwise set forth herein, Guarantor waives all rights and defenses arising out of an election of remedies by the Lender even though that election of remedies, such as a nonjudicial foreclosure with respect to the security for a guaranteed obligation, has destroyed Guarantor's rights of subrogation and reimbursement against the principal by operation of Section 580d of the California Code of Civil Procedure or otherwise. 16. CONSENT TO JURISDICTION; WAIVERS. GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS TO PERSONAL JURISDICTION IN THE COMMONWEALTH OF MASSACHUSETTS OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY, AND (B) WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS OF ANY STATE (I) TO THE RIGHT, IF ANY, TO TRIAL BY JURY(LENDER HAVING ALSO WAIVED SUCH RIGHT TO TRIAL BY JURY), (II) TO OBJECT TO JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS OR VENUE IN ANY PARTICULAR FORUM WITHIN THE COMMONWEALTH OF MASSACHUSETTS, AND (III) TO THE RIGHT, IF ANY, TO CLAIM OR RECOVER ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN OR IN ADDITION TO ACTUAL DAMAGES. EACH LENDER IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY AND ALL RIGHTS UNDER THE LAWS OF ANY STATE TO THE RIGHT, IF ANY, TO TRIAL BY JURY. GUARANTOR AGREES THAT, IN ADDITION TO ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER APPLICABLE LAW, ALL SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, DIRECTED TO GUARANTOR AT THE ADDRESS SET FORTH IN PARAGRAPH 14 ABOVE, AND SERVICE SO MADE SHALL BE COMPLETE FIVE (5) DAYS AFTER THE SAME SHALL BE SO MAILED. NOTHING CONTAINED HEREIN, HOWEVER, SHALL PREVENT LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING OR EXERCISING ANY RIGHTS AGAINST ANY SECURITY AND -14- 15 AGAINST GUARANTOR PERSONALLY, AND AGAINST ANY PROPERTY OF GUARANTOR, WITHIN ANY OTHER STATE. INITIATING SUCH SUIT, ACTION OR PROCEEDING OR TAKING SUCH ACTION IN ANY STATE SHALL IN NO EVENT CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED HEREIN THAT THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS SHALL GOVERN THE RIGHTS AND OBLIGATIONS OF GUARANTOR AND LENDER HEREUNDER OR OF THE SUBMISSION HEREIN MADE BY GUARANTOR TO PERSONAL JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS. GUARANTOR HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT. GUARANTOR CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH LENDER WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND ACKNOWLEDGES THAT LENDER HAS BEEN INDUCED TO ENTER INTO THIS GUARANTY AND THE OTHER LOAN DOCUMENTS TO WHICH THEY ARE PARTIES BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS CONTAINED IN THIS PARAGRAPH 16. GUARANTOR ACKNOWLEDGES THAT IT HAS HAD AN OPPORTUNITY TO REVIEW THIS PARAGRAPH 16 WITH ITS LEGAL COUNSEL AND THAT GUARANTOR AGREES TO THE FOREGOING AS ITS FREE, KNOWING AND VOLUNTARY ACT. 17. Successors and Assigns. The provisions of this Guaranty shall be binding upon Guarantor and its heirs, successors, successors in title, legal representatives, and assigns, and shall inure to the benefit of Lender, its successors, successors in title, legal representatives and assigns. 18. Assignment by Lender. This Guaranty is assignable by Lender in whole or in part in conjunction with any assignment of the Note or portions thereof, and any assignment hereof or any transfer or assignment of the Note or portions thereof by Lender shall operate to vest in any such assignee the rights and powers, in whole or in part, as appropriate, herein conferred upon and granted to Lender. 19. Severability. If any term or provision of this Guaranty shall be determined to be illegal or unenforceable, all other terms and provisions hereof shall nevertheless remain effective and shall be enforced to the fullest extent permitted by law. 20. Disclosure. Guarantor agrees that in addition to disclosures made in accordance with standard banking practices, any Lender may disclose information obtained by such Lender pursuant to this Guaranty to assignees or participants and potential assignees or participants hereunder. -15- 16 21. No Unwritten Agreements. THIS GUARANTY REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. 22. Time of the Essence. Time is of the essence with respect to each and every covenant, agreement and obligation of Guarantor under this Guaranty. 23. Ratification. Guarantor does hereby restate, reaffirm and ratify each and every warranty and representation regarding Guarantor or its Subsidiaries set forth in the Credit Agreement as if the same were more fully set forth herein. 24. Counterparts. This Guaranty and any amendment hereof may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument. In proving this Guaranty it shall not be necessary to produce or account for more than one such counterpart signed by the party against whom enforcement is sought. 25. Limited Resource Obligations. This Guaranty has been negotiated, executed and delivered on behalf of the Guarantor by the trustees or officers thereof in their representative capacity under an Amended and Restated Declaration of Trust dated as of January 15, 1996, as supplemented and amended, and not individually, and bind only the trust estate of the Guarantor, and no trustee, officer, employee, agent or shareholder of the Guarantor shall be bound or held to any personal liability or responsibility in connection with the agreements, obligations and undertakings of the Guarantor hereunder, and any person or entity dealing with the Guarantor in connection therewith shall look only to the trust estate for the payment of any claim or for the performance of any agreement, obligation or undertaking thereunder. IN WITNESS WHEREOF, Guarantor has executed this Guaranty under seal as of this 28th day of September, 1998. NEW PLAN REALTY TRUST, a Massachusetts business trust By: /s/ DEAN BERNSTEIN Name: Dean Bernstein Title: Vice President (SEAL) -16- 17 Lender joins in the execution of this Guaranty for the sole and limited purpose of evidencing its agreement to waiver of the right to trial by jury contained in Section 16(b)(i) hereof and Section 25 of the Credit Agreement. BANKBOSTON, N.A., As Agent for Lender By: /s/ JEFFREY L. WARWICK Name: Jeffrey L. Warwick Title: Director [BANK SEAL] -17- EX-12 7 RATIO OF EARNINGS TO FIXED CHARGES 1 EXHIBIT 12 RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS The following table sets forth the ratio of earnings to fixed charges and preferred stock dividend requirements for the periods indicated:
1994 1995 1996 1997 1998 ---- ---- ---- ---- ---- 17.0 8.1 4.9 3.5 3.0
For purposes of computing these ratios, earnings have been calculated by adding fixed charges (excluding capitalized interest and preferred stock dividends) to income before extraordinary items. Fixed charges consist of interest costs, whether expensed or capitalized, preferred stock dividend requirements, the interest component of rental expense, if any, and amortization of debt discounts and issue costs, whether expensed or capitalized. CALCULATION OF COMBINED RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS YEAR ENDED JULY 31, 1998 (DOLLAR AMOUNTS IN THOUSANDS) EARNINGS: Net income $90,573 Interest expense (including amortization of debt discount and issuing costs) 36,815 Other adjustments 551 -------- $127,951 ======== FIXED CHARGES: Interest expense (including amortization of debt discount and issuing costs) $36,815 Capitalized interest 12 Preferred stock dividends 5,850 Other adjustments 372 -------- $43,049 ======== RATIO OF EARNINGS TO FIXED CHARGES 3.0
EX-21 8 SUBSIDIARIES OF THE REGISTRANT 1 EXHIBIT 21 SUBSIDIARIES OF THE REGISTRANT New Plan Realty Trust, the Registrant. New Plan Securities Corp., a New York corporation. New Plan Realty of Alabama, Inc., an Alabama corporation. Avion Service Corp., a Pennsylvania corporation. New Plan Realty of Kingsport, Inc., a Tennessee corporation. New Plan Factory Malls, Inc., a Delaware corporation New Plan of Tara, Inc., a Delaware corporation New Plan of Fashion Corners, Inc., a Delaware corporation New Plan Disbursing Corp., a Delaware corporation New Plan Realty of Louisiana, Inc., a Delaware corporation New Plan of Tennessee, Inc., a Delaware corporation New Plan Realty of Louisiana, L.P., a Delaware limited partnership New Plan of Waterford Place, L.P., a Delaware limited partnership New Plan of Tennessee, L.P., a Delaware limited partnership New Plan of New Garden, Inc., a Delaware corporation New Plan of New Jersey, Inc., a Delaware corporation New Plan of Tinton Falls, Inc., a Delaware corporation New Plan of Eastgreen, Inc., a Delaware corporation New Plan of Northgate, Inc., a Delaware corporation New Plan of Polo Run, Inc., a Delaware corporation EX-23 9 CONSENT OF PRICEWATERHOUSECOOPERS LLP 1 EXHIBIT 23 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the registration statements of New Plan Realty Trust on Forms S-3 (File Nos. 333-15635, 033-61383, and 033-53311) and on Forms S-8 (File Nos. 33-57946 and 33-59077), of our report dated September 9, 1998, except for Note Q for which date is September 28, 1998, on our audits of the consolidated financial statements and financial statement schedules of New Plan Realty Trust and Subsidiaries, as of July 31, 1998 and 1997 and for the years ended July 31, 1998, 1997 and 1996, which report is included in this Annual Report on Form 10-K. PRICEWATERHOUSECOOPERS LLP New York, New York October 28, 1998 EX-27.1 10 FINANCIAL DATA SCHEDULE
5 YEAR JUL-31-1998 AUG-01-1997 JUL-31-1998 26,284 1,787 14,025 7,926 0 0 1,452,738 136,978 1,384,525 0 576,888 0 72,775 757,547 (65,796) 1,384,525 0 250,259 0 115,889 2,770 4,171 36,815 90,573 0 90,573 0 0 0 90,573 1.43 1.42
EX-99.1 11 PRO FORMA FINANCIAL DATA 1 EXHIBIT 99.1 UNAUDITED PRO FORMA OPERATING AND FINANCIAL INFORMATION The following tables set forth summary consolidated pro forma operating and financial information of New Plan Excel Realty Trust, Inc. for the year ended July 31, 1998 as if the merger of New Plan and Excel and each respective entity's property acquisitions during its current fiscal year had occurred on July 31, 1998 for balance sheet data and August 1, 1997 for income statement data. Information with respect to Excel is as of June 30, 1998 for balance sheet data and for the year ended June 30, 1998 for income statement data. The pro forma data included herein may not be indicative of the actual results or financial position had the merger of New Plan and Excel and the property acquisitions occurred on the dates indicated. The merger of New Plan and Excel has been accounted for as an acquisition of Excel by New Plan using the purchase method of accounting. The pro forma adjustments related to the merger are based on preliminary estimates of value. Actual adjustments will be based on the results of various appraisals and analysis of fair values. 2 NEW PLAN EXCEL REALTY TRUST, INC. PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEETS - UNAUDITED (In Thousands)
New Plan Excel Historical Historical Pro Forma July 31, June 30, Combined Pro Forma 1998 (2A) 1998 (2A) Adjustments Totals ----------- ----------- ----------- ----------- ASSETS Real estate, net $ 1,315,760 $ 902,133 $ 289,873(2B) $ 2,507,766 Cash 26,284 63,472 (12,200)(2C) 77,556 Accounts receivable, net 15,401 2,974 -- 18,375 Notes receivable - affiliates -- 66,616 -- 66,616 Notes receivable - other 13,878 30,975 -- 44,853 Other assets 13,202 21,153 10,556(2D) 44,911 ----------- ----------- ----------- ----------- Total assets $ 1,384,525 $ 1,087,323 $ 288,229 $ 2,760,077 =========== =========== =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Mortgages and other notes payable $ 576,888 $ 380,761 $ 9,083(2E) $ 966,732 Capital leases -- 27,229 -- 27,229 Accounts payable, accrued expenses and other liabilities 43,110 18,755 -- 61,865 ----------- ----------- ----------- ----------- Total liabilities 619,998 426,745 9,083 1,055,826 ----------- ----------- ----------- ----------- Minority interest in partnership -- 41,249 -- 41,249 ----------- ----------- ----------- ----------- Stockholders' Equity: Preferred stock 72,775 28 (72,774)(2F) 29 Beneficial interests 759,853 -- (759,853)(2F) -- Common stock -- 234 646(2F) 880 Additional paid-in capital -- 661,260 1,068,934(2F) 1,730,194 Accumulated distributions in excess of net income (66,608) (42,193) 42,193(2F) (66,608) Loans receivable - purchase of shares (2,306) -- -- (2,306) Unrealized gain on securities 813 -- -- 813 ----------- ----------- ----------- ----------- Total stockholders' equity 764,527 619,329 279,146 1,663,002 ----------- ----------- ----------- ----------- Total liabilities and stockholders' equity $ 1,384,525 $ 1,087,323 $ 288,229 $ 2,760,077 =========== =========== =========== ===========
The accompanying notes and management's assumptions are an integral part of this statement. 3 NEW PLAN EXCEL REALTY TRUST, INC. PRO FORMA CONSOLIDATED CONDENSED STATEMENTS OF INCOME - UNAUDITED FOR THE YEAR ENDED JULY 31, 1998 (In Thousands, Except Per Share Amounts)
New Plan New Plan Property Excel Historical Acquisitions Historical Excel Property Year Ended Aug. 1, 1997 Year Ended Acquisitions July 31, to July 31, New Plan June 30, July 1, 1997 to Excel Legacy 1998 (3A) 1998 Pro Forma 1998 (3A) June 30, 1998 Spin-off --------- ------------ --------- --------- ------------- -------- Revenues: Rental $ 246,309 $ 12,894 $ 259,203 $ 113,069 $ 19,075 $ (3,703) Interest and other 3,950 (266) 3,684 22,231 36 (2,101) --------- --------- --------- --------- --------- --------- Total revenue 250,259 12,628 262,887 135,300 19,111 (5,804) --------- --------- --------- --------- --------- --------- Expenses: Property expenses 88,438 4,507 92,945 22,265 4,185 -- Interest 36,815 5,999 42,814 29,042 3,196 (2,016) Depreciation and amortization 31,622 1,749 33,371 15,111 2,215 (652) General and administrative 2,770 -- 2,770 6,313 488 (1,154) --------- --------- --------- --------- --------- --------- Total expenses 159,645 12,255 171,900 72,731 10,084 (3,822) --------- --------- --------- --------- --------- --------- Income before real estate sales, minority interest and other 90,614 373 90,987 62,569 9,027 (1,982) Minority interest -- -- -- (1,558) -- -- Gains on sales of securities and other (41) -- (41) (2,229) -- -- Gain (loss) on sale of real estate -- -- -- 516 -- -- --------- --------- --------- --------- --------- --------- Net income $ 90,573 $ 373 $ 90,946 $ 59,298 $ 9,027 $ (1,982) ========= ========= ========= ========= ========= ========= Net income applicable to common shares Basic $ 84,723 $ 85,096 $ 44,673 --------- --------- --------- Diluted $ 84,723 $ 85,096 $ 46,231 Basic net income per common share $ 1.43 $ 1.43 $ 2.06 --------- --------- --------- Diluted net income per common share $ 1.42 $ 1.42 $ 1.95 ========= ========= ========= Merger Combined Pro Excel Pro Forma Forma Pro Forma Adjustments Results --------- ----------- ------- Revenues: Rental $ 128,441 $ 243(3B) $ 387,887 Interest and other 20,166 -- 23,850 --------- --------- --------- Total revenue 148,607 243 411,737 --------- --------- --------- Expenses: Property expenses 26,450 259(3C) 119,654 Interest 30,222 (2,502)(3D) 70,534 Depreciation and amortization 16,674 7,495 (3E) 57,540 General and administrative 5,647 310(3F) 8,727 --------- --------- --------- Total expenses 78,993 5,562 256,455 --------- --------- --------- Income before real estate sales, minority interest and other 69,614 (5,319) 155,282 Minority interest (1,558) -- (1,558) Gains on sales of securities and other (2,229) -- (2,270) Gain (loss) on sale of real estate 516 -- 516 --------- --------- --------- Net income $ 66,343 $ (5,319) $ 151,970 ========= ========= ========= Net income applicable to common shares Basic $ 51,718 $ 131,495 --------- --------- Diluted $ 53,276 $ 133,053 Basic net income per common share $ 2.21 $ 1.50 --------- --------- Diluted net income per common share $ 2.09 $ 1.47 ========= =========
4 NEW PLAN EXCEL REALTY TRUST, INC. PRO FORMA CONSOLIDATED CONDENSED STATEMENTS OF INCOME - UNAUDITED FOR THE YEAR ENDED JULY 31, 1998 (In Thousands, Except Per Share Amounts) (CONTINUED)
New Plan Excel Property Property New Plan Acquisitions Excel Acquisitions Historical Aug. 1, Historical July 1, Year Ended 1997 to Year Ended 1997 to Excel Excel July 31, July 31, New Plan June 30, June 30, Legacy Pro 1998 3(A) 1998 Pro Forma 1998 3(A) 1998 Spin-off Forma -------- ---- -------- -------- -------- ------ --- Historical basic weighted average number of common shares outstanding 59,365 21,657 Historical diluted weighted average number of common shares outstanding 59,774 23,703 Pro forma basic weighted average number of common shares outstanding 59,365 1,775(3G) 23,432 Pro forma diluted weighted average number of common shares outstanding 59,774 1,775(3G) 25,478 Merger Combined Pro Forma Pro Forma Adjustments Results --------- --------- Historical basic weighted average number of common shares outstanding Historical diluted weighted average number of common shares outstanding Pro forma basic weighted average number of common shares outstanding 87,483 Pro forma diluted weighted average number of common shares outstanding 90,348
The accompanying notes and management's assumptions are an integral part of this statement. 5 NEW PLAN EXCEL REALTY TRUST, INC. NOTES AND MANAGEMENT'S ASSUMPTIONS TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL INFORMATION - UNAUDITED (In thousands, except per share amounts) 1. Summary of Accounting Treatment: The exchange of New Plan Shares of Beneficial Interest for Excel Common Stock in connection with the Merger is being accounted for as a reverse merger for financial reporting purposes as if New Plan has acquired Excel. As such, the assets and liabilities of Excel have been adjusted to fair value in connection with the application of purchase accounting. 2. Adjustments to Pro Forma Consolidated Condensed Balance Sheets (A) Certain reclassifications have been made to the historical balance sheets of New Plan and Excel in order to conform to the desired pro forma combined condensed balance sheet presentation. (B) Represents adjustments to record the Merger in accordance with the purchase method of accounting based upon an assumed purchase price of Excel stock of $905,175. The purchase price was calculated assuming a market value of New Plan Shares of Beneficial Interest of $24.20 per share times the outstanding shares of Excel Common Stock of 28,118,668 after the 20% stock dividend to the current holders of Excel Common Stock. In addition, the Excel Preferred A Stock of 2,126,380 shares has been valued at $28.75 per share and the Excel Preferred B Stock of 630,000 shares has been valued at $24.90 per 1/10 of a share. All share prices were determined by taking the average of the closing stock prices 10 days before and after the announced merger date of May 14, 1998. The total purchase price is as follows:
Shares Total Security Outstanding Value Per Share Consideration - -------- ----------- --------------- ------------- Common Stock 28,118,668 $ 24.20 $ 680,472 Series A preferred stock 2,126,380 $ 28.75 61,133 Series B preferred stock to depositary shares 630,000 $ 24.90 156,870 ----------- Total consideration 898,475 Merger and the Other Transaction costs (see below) 6,700 ----------- Total purchase price $ 905,175 ===========
Estimated fees and expenses related to the Merger are as follows: Advisory fees $ 7,200 Accounting and legal 2,000 Other costs 3,000 ------- Total 12,200 Less Excel expenses 5,500 ------- New Plan transaction costs $ 6,700 =======
6 NEW PLAN EXCEL REALTY TRUST, INC. NOTES AND MANAGEMENT'S ASSUMPTIONS TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL INFORMATION - UNAUDITED (Continued) (In thousands, except per share amounts) The adjustment to reflect investment in real estate: Purchase price (see above) $ 905,175 Less historical book value of Excel equity (619,329) Transaction costs to be paid by Excel and expensed thereby reducing the historical book value of Excel 5,500 Adjustments to reflect certain assets and liabilities of Excel at fair value: Other assets (see Note (D)) $ (10,556) Mortgages and other notes payable (see Note (E)) 9,083 --------- (1,473) --------- Adjustment required to reflect investment in real estate, net $ 289,873 ========= (C) To reflect the decrease in cash due to the estimated Merger costs $ (12,200) ========= (D) Adjustments to other assets: To eliminate Excel's asset related to the straight-lining of rent related to leases $ (2,427) To eliminate Excel's asset of deferred financing costs (2,912) To eliminate Excel's asset of deferred leasing costs (1,083) To eliminate Excel's assets of organizational costs and goodwill (37) To adjust Excel's historical cost in ERT Development Corporation to estimated fair market value of $17,257 17,015 --------- $ 10,556 ========= (E) To record a premium required to adjust mortgages and other notes payable to fair value using estimated market rates ranging from 6.75% to 7.5% on an instrument by instrument basis $ 9,083 =========
(F) To adjust stockholders' equity to reflect the issuance of Excel's common stock to owners of New Plan's shares of beneficial interest as follows:
Cumulative Additional Distributions Preferred Beneficial Common Paid-in in Excess of Stock Interests Stock Capital Net Income ----------- ----------- ----------- ----------- ----------- Exchange of New Plan Shares of Beneficial Interest for Excel Common Stock $ -- $ (759,853) $ 599 $ 759,254 $ -- Exchange of New Plan Preferred Stock for Excel Preferred Stock (72,774) -- -- 72,774 -- Excel's historical Stockholders' equity (28) -- (234) (661,260) 42,193 Value of Excel acquisition 28 -- 281 898,166 -- ----------- ----------- ----------- ----------- ----------- $ (72,774) $ (759,853) $ 646 $ 1,068,934 $ 42,193 =========== =========== =========== =========== ===========
The historical cost of the other assets, including all accounts and notes receivable, and liabilities of Excel are estimated to be their fair market value. 7 NEW PLAN EXCEL REALTY TRUST, INC. NOTES AND MANAGEMENT'S ASSUMPTIONS TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL INFORMATION - UNAUDITED (Continued) (In thousands, except per share amounts) 3. Adjustments To Pro Forma Consolidated Condensed Statements of Income (A) Certain reclassifications have been made to the historical statements of income of New Plan and Excel in order to conform to the desired pro forma combined condensed statements of income presentation. The Consolidated Condensed Statements of Income include pro forma adjustments for real estate acquisitions that both companies have made within the past twelve months. The cash used to acquire real estate by New Plan has been assumed to come from available cash in savings and from new debt issues. The new debt issued by New Plan was assumed to have an average interest rate of 6.8%. Depreciation expense on the New Plan acquisitions was based on an estimated useful life of 40 years, using the straight line method and allocating the cost between land and building at 20% and 80%, respectively. The cash used to acquire real estate by Excel has been assumed to come from approximately $223 million in equity offerings and the issuance of $39 million in debt. The following adjustments have been made to convert the operations of Excel, which has reported operations on a calendar year basis, to a year ended June 30, 1998 (this approximates the July 31 year end of New Plan).
Add: Six Months Less: Year Ended Year Ended, Ended Six Months Ended Dec. 31, 1997 June 30, 1998 June 30, 1998 June 30, 1997 ------------- ------------- ------------- ------------- Revenues: $ 83,112 $ 63,486 $ 33,529 $ 113,069 Rental revenue 22,346 10,021 10,136 22,231 --------- --------- --------- --------- Interest and other 105,458 73,507 43,665 135,300 --------- --------- --------- --------- Total revenue Expenses: Property expenses 14,023 13,689 5,447 22,265 Interest 23,991 14,886 9,835 29,042 Depreciation and amortization 11,621 8,248 4,758 15,111 General and administrative 5,046 3,614 2,347 6,313 --------- --------- --------- --------- Total expenses 54,681 40,437 22,387 72,731 --------- --------- --------- --------- Income before real estate sales, minority interest and other 50,777 33,070 21,278 62,569 Minority interest (816) (812) (70) (1,558) Real estate gains on sale/impairments 523 286 293 516 Other (1,522) (707) -- (2,229) --------- --------- --------- --------- Net income $ 48,962 $ 31,837 $ 21,501 $ 59,298 ========= ========= ========= ========= Basic net income per share $ 2.06 $ 0.98 $ 0.95 $ 2.06 ========= ========= ========= ========= Diluted net income per share $ 1.97 $ 0.93 $ 0.93 $ 1.95 ========= ========= ========= =========
8 NEW PLAN EXCEL REALTY TRUST, INC. NOTES AND MANAGEMENT'S ASSUMPTIONS TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL INFORMATION - UNAUDITED (Continued) (In thousands, except per share amounts) (B) To recognize revenue from straight-lining rent related to Excel's leases which will be reset in connection with the Merger $ 243 (C) To reflect the decrease in amortization of Excel's deferred leasing costs $ (259) (D) To reflect the following adjustments to interest expense: (1) To recognize the elimination of amortization of deferred loan costs $ (763) (2) To reflect the amortization of the premium required to adjust Excel's mortgages and other notes payable to fair value (1,739) -------- Total adjustment $ (2,502) ======== (E) To reflect the increase in depreciation as a result of recording Excel's real estate assets at fair value versus historical cost, utilizing an estimated useful life of 40 years and allocating the cost between land and buildings at 20% and 80%, respectively Pro forma depreciation $ 23,840 Excel's historical depreciation (14,782) Pro forma depreciation on property acquisitions (2,215) Pro forma depreciation from Legacy spin-off 652 -------- Total adjustment $ 7,495 ======== (F) To reflect the increase in general and administrative costs mainly due to increased salary costs under new contractual agreements $ 310 (G) To increase the weighted average shares outstanding for Excel for the issuance of common stock and common stock equivalents for the purchase of real estate by Excel. These shares have been accounted for on a pro forma basis to be outstanding during the entire period presented Basic 1,775 Diluted 1,775
(H) The pro forma weighted average number of common shares outstanding for the periods are computed based on the historical weighted average shares outstanding of New Plan and 1.2 times the pro forma weighted average shares outstanding of Excel after giving effect to the issuance of common stock equivalents for the purchase of real estate as noted in item (G) above. (I) Includes pro forma effects of the acquisition of real estate properties by New Plan. (J) Reflects the decrease in net income applicable to common shares due to the assumed issuance of Excel preferred securities on July 1, 1997 -----END PRIVACY-ENHANCED MESSAGE-----