-----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, JVJ276Femfz9XDP60G/+mLfxDReSUV9F6vAYPrjRGgtLvZsIiPdlrRBT6QCpqcOO Gc6gdwGhAH5fzlmJOOIBCQ== 0000950134-99-000478.txt : 19990128 0000950134-99-000478.hdr.sgml : 19990128 ACCESSION NUMBER: 0000950134-99-000478 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19990127 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRANSCONTINENTAL REALTY INVESTORS INC CENTRAL INDEX KEY: 0000733590 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 946565852 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 001-09240 FILM NUMBER: 99513721 BUSINESS ADDRESS: STREET 1: 10670 N CENTRAL EXPRWY STE 300 CITY: DALLAS STATE: TX ZIP: 75231 BUSINESS PHONE: 2146924700 MAIL ADDRESS: STREET 1: 10670 N CENTRAL EXPRWY STREET 2: SUITE 300 CITY: DALLAS STATE: TX ZIP: 75231 FORMER COMPANY: FORMER CONFORMED NAME: JOHNSTOWN CONSOLIDATED REALTY TRUST /CA/ DATE OF NAME CHANGE: 19890815 FORMER COMPANY: FORMER CONFORMED NAME: JOHNSTOWN CONSOLIDATED REALTY TRUST DATE OF NAME CHANGE: 19861005 10-K405/A 1 AMENDMENT TO FORM 10-K FOR PERIOD ENDED 12/31/97 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A [X] ANNUAL REPORT PURSUANT TO SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE YEAR ENDED DECEMBER 31, 1997 Commission File Number 1-9240 TRANSCONTINENTAL REALTY INVESTORS, INC. ------------------------------------------------------ (Exact Name of Registrant as Specified in Its Charter) Nevada 94-6565852 - ------------------------------- ------------------- (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 10670 North Central Expressway, Suite 300, Dallas, Texas 75231 - -------------------------------------------------------- ---------- (Address of Principal Executive Offices) (Zip Code) (214) 692-4700 ---------------------------------------------------- (Registrant's Telephone Number, Including Area Code) Securities Registered Pursuant to Section 12(b) of the Act:
Name of each exchange on Title of each class which registered - ------------------------------ ---------------------------- Common Stock, $.01 par value New York Stock Exchange
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 (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for at least 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] As of March 6, 1998, the Registrant had 3,889,200 shares of Common Stock outstanding. Of the total shares outstanding 2,128,945 were held by other than those who may be deemed to be affiliates, for an aggregate value of $33,531,000 based on the last trade as reported on the New York Stock Exchange on March 6, 1998. The basis of this calculation does not constitute a determination by the Registrant that all of such persons or entities are affiliates of the Registrant as defined in Rule 405 of the Securities Act of 1933, as amended. Documents Incorporated by Reference: Consolidated Financial Statements of Income Opportunity Realty Investors, Inc. Commission File No. 1-9525 1 2 This Form 10-K/A amends the Registrant's annual report on Form 10-K for the year ended December 31, 1997 as follows: ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - LIQUIDITY AND CAPITAL RESOURCES - page 28. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - CONSOLIDATED STATEMENTS OF CASH FLOWS - page 41 and 42. 3 ITEM 6. SELECTED FINANCIAL DATA (Continued) The Company purchased fifteen properties in 1997 for a total of $69.9 million and six properties in 1996 for a total of $7.2 million. The Company sold five properties in 1997 for a total of $30.6 million and five properties in 1996 for a total of $9.6 million. Shares and per share data have been restated for the three for two forward Common Stock split effected February 15, 1996. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Introduction Transcontinental Realty Investors, Inc. (the "Company") invests in real estate through acquisitions, leases and partnerships and in mortgage loans on real estate, including first, wraparound and junior mortgage loans. The Company is the successor to a California business trust organized on September 6, 1983 which commenced operations on January 31, 1984. Liquidity and Capital Resources Cash and cash equivalents at December 31, 1997 aggregated $24.7 million compared with $1.0 million at December 31, 1996. The principal reasons for this increase in cash are discussed in the paragraphs below. The Company's principal sources of cash have been and will continue to be from property operations, proceeds from property sales, the collection of mortgage notes receivable, borrowings and to a lesser extent, distributions from partnerships. The Company expects that its cash balance at December 31, 1997, and cash that will be generated in 1998 from the collection of mortgage notes receivable, sales of properties, borrowings against certain of the Company's unencumbered properties and refinancing or extension of certain of its mortgage debt will be sufficient to meet all of the Company's cash requirements, including debt service obligations coming due in 1998, dividend payments and property maintenance and improvements, as more fully discussed in the paragraphs below. Net cash provided by operating activities increased to $1.2 million in 1997 from a cash deficit of $3.4 million in 1996. The primary factors affecting the Company's cash flow from operations are discussed in the following paragraphs. The Company's cash flow from property operations (rents collected less payments for property operating expenses) increased from $12.7 million in 1996 to $16.2 million in 1997. This increase is primarily the result of the Company having acquired 5 income producing properties in 1996 and 15 income producing properties in 1997. Also contributing to the increase was increased occupancy and rents, at the Company's apartments and commercial properties, and the Company's control of operating expenses. These increases are partially offset by decreases due to the sale of three income producing properties in 1996 and 1997, respectively. The Company's management believes that this trend will continue as a result of increased rental rates at both the Company's apartments and commercial properties and increased occupancy at its commercial properties. Interest collected decreased from $1.2 million in 1996 to $1.1 million in 1997. This decrease is due to four mortgage notes receivable being paid in full in 1997. Interest paid increased from $14.2 million in 1996 to $16.0 million in 1997. This increase is due to properties acquired subject to debt and financings and refinancings obtained on previously unencumbered properties during 1996 and 1997. These increases were partially offset by a decrease of $73,000 due to properties sold in 1997. General and administrative expenses paid decreased from $2.8 million in 1997 to $2.5 million in 1996. This decrease is due to a decrease in legal fees related to the Olive and other litigation partially offset by an increase in advisory cost reimbursements and other professional fees. In January 1997, the Company received an insurance settlement of $9.5 million relating to 1995 hail storm and flood damage to the Republic Towers Office Building in Dallas, Texas. In 1996 the Company received a $1.5 million litigation settlement from the former owners of an office building in New Jersey. 28 4 TRANSCONTINENTAL REALTY INVESTORS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, -------------------------------------------- 1997 1996 1995 ------------ ------------ ------------ (dollars in thousands) Cash Flows from Operating Activities Rents collected ............................... $ 57,144 $ 43,401 $ 46,511 Interest collected ............................ 1,098 1,232 1,256 Interest paid ................................. (16,016) (14,167) (14,676) Payments for property operations (including $2,262 in 1997, $1,879 in 1996 and $2,928 in 1995 to affiliates) ...... (40,984) (30,738) (31,171) Advisory and net income fee paid to affiliate ................................... (1,807) (1,784) (1,770) General and administrative expenses paid (including $1,187 in 1997, $1,047 in 1996 and $877 in 1995 to affiliates) ........ (2,457) (2,785) (1,216) Distributions from operating cash flow of equity investees ............................ 687 649 666 Insurance/Litigation settlement ............... 9,633 1,500 500 Other ......................................... 1,119 (754) 1,122 ------------ ------------ ------------ Net cash provided by (used in) operating activities ............................... 8,417 (3,446) 1,222 Cash Flows from Investing Activities Collections on notes receivable ............... 5,048 952 2,851 Real estate improvements ...................... (5,767) (3,406) (8,024) Proceeds from sale of real estate ............. 29,081 8,922 24,445 Acquisitions of real estate (including $2,966 in 1997, $339 in 1996 and $56 in 1995 to affiliates) ......................... (46,433) (7,689) (1,339) Acquisition of partnership interests .......... -- -- (50) Contributions to equity investees ............. (731) (161) (443) ------------ ------------ ------------ Net cash provided by (used in) investing activities .................................... (18,802) (1,382) 17,440
The accompanying notes are an integral part of these Consolidated Financial Statements. 41 5 TRANSCONTINENTAL REALTY INVESTORS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
For the Years Ended December 31, 1997 1996 1995 ------------ ------------ ------------ (dollars in thousands) Cash Flows from Financing Activities Distributions from financing cash flow of equity investees ............................... $ 1,101 $ -- $ 853 Payments on notes payable ....................... (37,095) (14,545) (35,205) Proceeds from notes payable ..................... 73,817 13,550 26,072 Dividends paid .................................. (1,090) (1,115) (267) Shares of Common Stock repurchased .............. (445) (904) -- Deferred financing costs ........................ (2,130) (818) (1,058) ------------ ------------ ------------ Net cash provided by (used in) financing activities ....................... 34,158 (3,832) (9,605) ------------ ------------ ------------ Net increase (decrease) in cash and cash equivalents .................................... 23,773 (8,660) 9,057 Cash and cash equivalents, beginning of year ..... 960 9,620 563 ------------ ------------ ------------ Cash and cash equivalents, end of year ........... $ 24,773 $ 960 $ 9,620 ============ ============ ============ Reconciliation of net income (loss) to net cash provided by (used in) operating activities Net income (loss) ............................. $ 12,599 $ (7,806) $ (3,726) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities Depreciation and amortization ............ 10,005 8,857 9,180 Provision for losses ..................... 1,337 1,579 -- Extraordinary gain ....................... -- (256) (1,437) Equity in (income) loss of equity investees .............................. (812) 20 1,083 Gain on sale of real estate .............. (21,404) (1,579) (5,822) Distributions from operating cash flow of equity investees .................... 687 649 666 (Increase) in interest receivable ........ (244) (5) (4) Decrease in other assets ................. 3,740 1,759 1,098 Increase in interest payable ............. 165 200 635 (Decrease) in other liabilities .......... 2,344 (6,864) (451) ------------ ------------ ------------ Net cash provided by (used in) operating activities ..................................... $ 8,417 $ (3,446) $ 1,222 ============ ============ ============
The accompanying notes are an integral part of these Consolidated Financial Statements. 42 6 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. TRANSCONTINENTAL REALTY INVESTORS, INC. Dated: January 27, 1999 By: /s/ Randall M. Paulson --------------------- ---------------------------------- Randall M. Paulson President 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 date indicated. By: /s/ Ted P. Stokely ---------------------------------- Ted P. Stokely Chairman of the Board and Director By: /s/ Richard W. Douglas By: /s/ Murray Shaw --------------------------- ------------------------- Richard W. Douglas Murray Shaw Director Director By: /s/ Larry E. Harley By: /s/ Martin L. White --------------------------- ------------------------- Larry E. Harley Martin L. White Director Director By: /s/ R. Douglas Leonhard By: /s/ Edward G. Zampa --------------------------- ------------------------- R. Douglas Leonhard Edward G. Zampa Director Director Dated: January 27, 1999 By: /s/ Thomas A. Holland ------------------------ ------------------------- Thomas A. Holland Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) 89 -----END PRIVACY-ENHANCED MESSAGE-----