-----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, LU7Xa9JG2KMHIrDWC8Hj6/mSXH7IruLLGPAqcZCMoMCce2Bys8aK1i95eXD6C0ZL JpMiIdIu6Zc33D7D5SmAjQ== 0000908737-96-000211.txt : 19960816 0000908737-96-000211.hdr.sgml : 19960816 ACCESSION NUMBER: 0000908737-96-000211 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960815 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEALTH & RETIREMENT PROPERTIES TRUST CENTRAL INDEX KEY: 0000803649 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 046558834 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-09317 FILM NUMBER: 96616210 BUSINESS ADDRESS: STREET 1: 400 CENTRE ST CITY: NEWTON STATE: MA ZIP: 02158 BUSINESS PHONE: 6173323990 MAIL ADDRESS: STREET 1: 400 CENTRE STREET CITY: NEWTON STATE: MA ZIP: 02158 FORMER COMPANY: FORMER CONFORMED NAME: HEALTH & REHABILITATION PROPERTIES TRUST DATE OF NAME CHANGE: 19920703 10-Q/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q/A AMENDMENT 1 (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File Number 1-9317 HEALTH AND RETIREMENT PROPERTIES TRUST (Exact name of registrant as specified in its charter) Maryland 04-6558834 - --------------------------------- ------------------------------- (State or other jurisdiction (IRS Employer of incorporation) Identification No.) 400 Centre Street, Newton, Massachusetts 02158 (Address of principal executive offices) (Zip Code) 617-332-3990 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Number of Common Shares outstanding at August 12, 1996: 66,209,476 shares of beneficial interest, $.01 par value. HEALTH AND RETIREMENT PROPERTIES TRUST FORM 10-Q JUNE 30, 1996 THE AMENDED AND RESTATED DECLARATION OF TRUST OF THE COMPANY, DATED JULY 1, 1994, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE "DECLARATION"), IS DULY FILED IN THE OFFICE OF THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF MARYLAND, PROVIDES THAT THE NAME "HEALTH AND RETIREMENT PROPERTIES TRUST" REFERS TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY. ALL PERSONS DEALING WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THE COMPANY FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
INDEX Page PART I Financial Information Item 1. Financial Statements (Unaudited) Balance Sheets - June 30, 1996 and December 31, 1995 1 Statements of Income - Three and Six Months Ended June 30, 1996 2 and 1995 Statements of Cash Flows - Six Months Ended June 30, 1996 and 3 1995 Notes to Financial Statements 4 Item 2. Management's Discussion and Analysis of Financial Condition and 6 Results of Operations PART II Other Information Item 4. Submission of Matters to a Vote of Securities Holders 8 Item 6. Exhibits and Reports on Form 8-K 8 Signatures 9
HEALTH AND RETIREMENT PROPERTIES TRUST BALANCE SHEETS (dollars in thousands, except per share amounts) (unaudited) June 30, December 31, 1996 1995 ----------------- ----------------- ASSETS Real estate properties, at cost (including properties leased to affiliates with a cost of $104,913 and $103,324, respectively): Land .......................................................... $ 75,680 $ 72,124 Buildings and improvements .................................... 741,139 706,087 ----------- ----------- 816,819 778,211 Less accumulated depreciation ................................. 66,053 55,855 ----------- ----------- 750,766 722,356 Real estate mortgages and notes, net (including note to affiliate of $1,365 and $1,565, respectively) ......................... 150,113 141,307 Investment in Hospitality Properties Trust ........................ 103,250 99,959 Cash and cash equivalents ......................................... 18,403 18,640 Interest and rents receivable ..................................... 9,486 7,895 Deferred interest and finance costs, net, and other assets ........ 11,286 9,520 ----------- ----------- $ 1,043,304 $ 999,677 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Bank notes payable ................................................ $ 117,000 $ 53,000 Senior notes and bonds payable, net ............................... 199,262 216,759 Accounts payable and accrued expenses ............................. 10,964 11,597 Security deposits ................................................. 7,420 7,386 Due to affiliates ................................................. 596 2,351 Dividends payable ................................................. -- 22,992 Commitments and contingencies Shareholders' equity: Preferred shares of beneficial interest, $.01 par value: 50,000,000 shares authorized, none issued ................... -- -- Common shares of beneficial interest, $.01 par value: 100,000,000 shares authorized, 66,209,476 shares and 65,690,166 shares issued and outstanding, respectively ...... 662 657 Additional paid-in capital .................................... 783,258 775,688 Cumulative net income ......................................... 271,275 233,044 Dividends ..................................................... (347,133) (323,797) ----------- ----------- Total shareholders' equity ................................... 708,062 685,592 ----------- ----------- $ 1,043,304 $ 999,677 =========== ===========
See accompanying notes 1
HEALTH AND RETIREMENT PROPERTIES TRUST STATEMENTS OF INCOME (Amounts in thousands, except per share amounts) (unaudited) Quarter Ended June 30, Six Months Ended June 30, 1996 1995 1996 1995 -------- -------- -------- -------- Revenues: Rental income ................................. $ 23,389 $ 24,966 $ 46,277 $ 44,796 Interest income ............................... 5,438 5,532 10,286 11,694 -------- -------- -------- -------- Total revenues .............................. 28,827 30,498 56,563 56,490 -------- -------- -------- -------- Expenses: Interest ...................................... 5,285 7,013 10,246 11,144 Depreciation and amortization ................. 5,319 6,161 10,501 10,776 General and administrative .................... 1,600 1,656 3,073 3,070 -------- -------- -------- -------- Total expenses .............................. 12,204 14,830 23,820 24,990 -------- -------- -------- -------- Income before equity in earnings of Hospitality Properties Trust, gain on sale of property and extraordinary item ......................... 16,623 15,668 32,743 31,500 Equity in earnings of Hospitality Properties Trust 2,236 -- 4,328 -- Gain on equity transaction of Hospitality Properties Trust ............................... 3,603 -- 3,603 -- -------- -------- -------- -------- Income before gain on sale of property and extraordinary item ............................. 22,462 15,668 40,674 31,500 Gain on sale of property ......................... -- -- -- 2,476 -------- -------- -------- -------- Income before extraordinary item ................. 22,462 15,668 40,674 33,976 Extraordinary item - early extinguishment of debt -- -- (2,443) -- -------- -------- -------- -------- Net income ....................................... $ 22,462 $ 15,668 $ 38,231 $ 33,976 ======== ======== ======== ======== Weighted average shares outstanding .............. 66,199 59,180 66,177 58,869 ======== ======== ======== ======== Per share amounts: Income before gain on sale of property and extraordinary item $0.34 $0.26 $0.61 $0.54 ======== ======== ======== ======== Income before extraordinary item................. $0.34 $0.26 $0.61 $0.58 ======== ======== ======== ======== Net income....................................... $0.34 $0.26 $0.58 $0.58 ======== ======== ======== ========
See accompanying notes 2
HEALTH AND RETIREMENT PROPERTIES TRUST STATEMENTS OF CASH FLOWS (dollars in thousands) (unaudited) For the Six Months Ended June 30, 1996 1995 ----------- ------------ Cash flows from operating activities: Net income ........................................................ $ 38,231 $ 33,976 Adjustments to reconcile net income to cash provided by operating activities: Gain on sale of property ...................................... -- (2,476) Gain on sale of stock by Hospitality Properties Trust ......... (3,603) -- Equity in earnings of Hospitality Properties Trust ............ (4,328) -- Extraordinary item ............................................ 2,443 -- Depreciation and amortization ................................. 10,501 10,776 Amortization of deferred interest costs ....................... 856 673 Change in assets and liabilities: Increase in in(6,346)and rents recei(6,965)nd other assets Increase in security deposits ............................... 34 3,351 Decrease in accounts payable and accrued expenses ........... (633) (3,483) Decrease in due to affiliate ................................ (1,175) (1,508) --------- --------- Cash provided by operating activities ........................... 35,980 34,344 --------- --------- Cash flows from investing activities: Real estate acquisitions .......................................... (38,608) (187,448) Investments in mortgage loans ..................................... (15,782) (20,889) Proceeds from repayment of notes and mortgage loans ............... 6,997 10,414 Proceeds from sale of real estate ................................. -- 5,000 Repayment and advance of loan to affiliate ........................ 200 (1,065) Dividends from Hospitality Properties Trust ....................... 4,640 -- --------- --------- Cash used for investing activities .............................. (42,553) (193,988) --------- --------- Cash flows from financing activities: Proceeds from issuance of common shares ........................... 6,995 -- Proceeds from borrowings .......................................... 64,000 168,000 Payments on borrowings ............................................ (17,620) -- Deferred finance costs ............................................ (711) (1,011) Dividends paid .................................................... (46,328) (39,632) --------- --------- Cash provided by financing activities ........................... 6,336 127,357 --------- --------- Decrease in cash ..................................................... (237) (32,287) Cash and cash equivalents at beginning of period ..................... 18,640 59,766 --------- --------- Cash and cash equivalents at end of period ........................... $ 18,403 $ 27,479 ========= ========= Supplemental cash flow information: Interest paid ..................................................... $ 10,176 $ 9,741 ========= ========= Non-cash investing and financing activities: Purchase of real estate ........................................... $ -- $ (42,384) Issuance of shares ................................................ -- 24,684 Sale of real estate ............................................... -- 19,500 Investment in mortgage loan ....................................... -- (19,500) Increase in security deposit ...................................... -- 17,940
See accompanying notes 3 HEALTH AND RETIREMENT PROPERTIES TRUST NOTES TO FINANCIAL STATEMENTS (dollars in thousands, except per share data) Note 1. Basis of Presentation The financial statements of Health and Retirement Properties Trust (the "Company") have been prepared in accordance with generally accepted accounting principals for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. Note 2. Shareholders' Equity On July 1, 1996, the Trustees declared a dividend on the Company's common shares with respect to the quarter ended June 30, 1996, of $0.35 which will be distributed on or about August 22, 1996 to shareholders of record as of July 25, 1996. In January 1996, the Company issued 475,000 shares, resulting in net proceeds of approximately $6,995, as a result of the underwriters exercise of the over-allotment option pursuant to the December 1995 equity offering by the Company. In April, 1996, the Company issued 35,560 restricted shares of common stock to HRPT Advisors, Inc. (the "Advisor"), an affiliate, as compensation for the incentive fee earned for the year ended December 31, 1995. In June 1996, 7,250 shares were granted to officers of the Company and certain employees of the Advisor under the 1992 Incentive Share Award Plan. The three independent Trustees, as part of their annual fee, were also each granted 500 shares. The shares granted to the officers and certain employees of the Advisor vest over a three year period. The shares granted to the Trustees vest immediately. Note 3. Real Estate Properties During 1996, the Company purchased two medical clinics and five nursing facilities for approximately $35,639 and simultaneously leased these properties for periods up to 21 years. During the six months ended June 30, 1996, the Company also provided $2,969 of improvement financing to existing tenants. At June 30, 1996, 31% of the Company's real estate properties, net, and mortgage receivables were in properties leased to Marriott International, Inc. ("Marriott"). The financial statements of Marriott have been filed as a part of Marriott's Quarterly Report on Form 10-Q, file number 1-12188, for the quarter ended June 14, 1996. At June 30, 1996, the Company had total commitments outstanding aggregating $34,599 for improvements to certain properties leased or mortgaged by the Company and to purchase a medical office building. Note 4. Investment in Hospitality Properties Trust At June 30, 1996, the Company owned 4,000,000 shares of the common stock of Hospitality Properties Trust ("HPT") with a carrying value of $103,250 and market value of $107,000. HPT is a real estate investment trust investing principally in income producing hotel and lodging related real estate. The Company's percentage of ownership of HPT as of June 30, 1996, was 14.9%. During April 1996, HPT completed a public stock offering of 14,250,000 shares of common stock at a per share price of $26.625 for total consideration of approximately $379,406. As a result of this transaction, the company's ownership percentage was reduced from 31.7% to 14.9%. Pursuant to the HPT offering, the Company realized a gain of $3,603. The Company uses the income statement method to account for issuances of common stock by HPT. Although the Company did not sell any shares, under this method gains and losses on issuance of stock by a HPT are recognized in the income statement. 4 HEALTH AND RETIREMENT PROPERTIES TRUST NOTES TO FINANCIAL STATEMENTS (dollars in thousands, except per share data) Note 5. Real Estate Mortgages and Notes Receivable, net During 1996, the Company provided debt financing totaling $15,782 secured by a retirement community and by properties under existing mortgages with the Company. These mortgage and notes receivable bear interest between 10.5% and 11% and mature between 2006 and 2008. The Company also provided improvement financing for existing facilities of $782. The Company received regularly scheduled principal payments and prepayments of mortgages secured by four nursing facilities totaling $6,997. Note 6. Indebtedness In March 1996, the Company entered into a new agreement and refinanced its $250 million unsecured revolving bank credit facility. The restated credit facility matures in 2000 and bears interest at LIBOR plus 0.875% per annum. In connection with the refinancing, the Company recognized an extraordinary loss of $2,443 from the early extinguishment of debt. At June 30, 1996, $117,000 was outstanding under the credit facility. In April, 1996, the Company prepaid the outstanding secured Revenue Refunding Bonds totaling $17,620 by borrowing on the revolving bank credit facility and from available cash. 5 HEALTH AND RETIREMENT PROPERTIES TRUST MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION RESULTS OF OPERATIONS Quarter Ended June 30, 1996 Versus 1995 Total revenues for the quarter ended June 30, 1996, decreased to $28,827,000 from $30,498,000 for the quarter ended June 30, 1995. Rental income decreased by $1,577,000 and interest income decreased by $94,000. Rental income decreased because revenue for the 1996 period does not include revenues from the Company's formerly wholly owned subsidiary, Hospitality Properties Trust ("HPT"). In March 1995, HPT acquired 21 Courtyard by Marriott(R) hotels. In August 1995, HPT completed its initial public offering (the "IPO"). Prior to the IPO, operating results of HPT were included in the Company's results of operations. Since the IPO, the Company's investment in HPT has been accounted for using the equity method. The Company's percentage of ownership of HPT as of June 30, 1996, was 14.9%. This rental revenue decrease has been partially offset by $118,630,000 of new real estate investments subsequent to June 30, 1995. Interest income decreased as a result of mortgage loan payoffs subsequent to June 30, 1995 and lower cash balances compared to the quarter ended June 30, 1995. Total expenses for the quarter ended June 30, 1996, decreased to $12,204,000 from $14,830,000 for the quarter ended June 30, 1995. Interest, depreciation and amortization, and general and administrative expense decreased by $1,728,000, $842,000 and $56,000 respectively. Interest decreased due to lower interest rates and lower debt outstanding during the quarter ended June 30, 1996 as compared to the quarter ended June 30, 1995. Amortization expense decreased as a result of the early extinguishment of debt during March 1996. Depreciation and general and administrative expenses decreased primarily as the result of the HPT transaction described above. Net income for the quarter ended June 30, 1996, increased to $22,462,000 or $.34 per share, from $15,668,000, or $.26 per share, for the same quarter in 1995. This increase is primarily a result of new investments since June 30, 1995, and the recognition of a gain resulting from the public stock offering by HPT of its shares. The Company bases its dividend primarily on Funds from Operations ("FFO"). The Company has adopted the National Association of Real Estate Investment Trust's ("NAREIT") definition of FFO, as income before equity in earnings of HPT, gain (loss) on sale of real estate and extraordinary items, plus depreciation and the Company's proportionate share of HPT's FFO. FFO for the 1996 quarter was $24,838,000, or $.38 per share, as compared to $21,438,000, or $.36 per share, for the 1995 quarter. Cash available for distribution may not necessarily equal FFO as the cash flow of the Company is affected by other factors not included in the FFO calculation. The dividends declared which relate to these quarters were $23,170,000, or $.35 per share, in 1996 and $20,121,000, or $.34 per share, in 1995. Six Months Ended June 30, 1996 Versus 1995 Total revenues for the six months ended June 30, 1996 increased to $56,563,000 from $56,490,000 for the six months ended June 30, 1995. Rental income increased by $1,481,000 and interest income decreased by $1,408,000. Rental income increased primarily as the net result of $118,630,000 of new investments subsequent to June 30, 1995, offset by the HPT transaction described above. Interest income decreased as a result of mortgage loan payoffs subsequent to June 30, 1995 and lower cash balances compared to the six months ended June 30, 1995. Total expenses for the six months ended June 30, 1996 decreased to $23,820,000 from $24,990,000 for the six months ended June 30, 1995. Interest expense and depreciation and amortization expense decreased by $898,000 and $275,000, respectively, while general and administrative increased by $3,000. Interest expense decreased due to lower interest rates and lower debt outstanding during the six months ended June 30, 1996 as compared to the quarter ended June 30, 1995. Depreciation and amortization expense decreased primarily as a result of the depreciation expense associated with the HPT transaction and amortization expense reduced by the early extinguishment of debt during March 1996. General and administrative remained relatively unchanged from the prior year, with the increased expenses related to new investments being offset by decreases associated with the HPT transaction. 6 HEALTH AND RETIREMENT PROPERTIES TRUST MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION Six Months Ended June 30, 1996 Versus 1995 - continued Net income increased to $38,231,000, or $.58 per share, for the 1996 period from $33,976,000, or $.58 per share, for the 1995 period. The increase in net income is primarily a result of the new investments since June 30, 1995, and the recognition of a gain resulting from the public stock offering by HPT of its shares. Funds from operations for the six months ended June 30, 1996, were $49,000,000, or $.74 per share, and $41,497,000, or $.70 per share, for the 1995 period. The dividends declared which relate to the six months ended June 30, 1996 and 1995 were $46,328,000, or $.70 per share, and $40,246,000, or $.68 per share, respectively. LIQUIDITY AND CAPITAL RESOURCES Total assets of the Company increased to $1.043 billion at June 30, 1996, from $999,667,000 million at December 31, 1995. The increase is primarily attributable to new real estate acquisitions and the issuance of additional mortgage loans. During 1996, the Company purchased two medical clinics and five nursing for approximately $35,639,000, which were simultaneously leased for periods up to 21 years. During the six months ended June 30, 1996, the Company also provided $2,969,000 of improvement financing to existing tenants. These transactions were funded with cash on hand and draws on the Company's revolving credit facility. During 1996, the Company provided debt financing totaling $15,782,000 secured by a retirement community and cross-collateralized by properties under existing mortgages with the Company. These mortgage and notes receivable bear interest between 10.5% and 11% and mature between 2006 and 2008. During this period, the Company also provided improvement financing for existing facilities of $782,000. These transactions were funded with cash on hand and draws on the Company's revolving credit facility. In January 1996, the underwriters for the December 1995 share offering exercised the over-allotment option for 475,000 shares resulting in net proceeds of approximately $6,995,000. At June 30, 1996, the Company had $18,403,000 of cash and cash equivalents, and the ability to borrow up to an additional $133,000,000 under its revolving credit facility. The facility matures in 2000 and bears interest at a spread over LIBOR. The effective interest rates on the Company's senior notes are capped by the use of interest rate cap agreements. The interest rate cap agreements provide for maximum weighted average interest rates of approximately 6.24% on $200,000,000 of variable rate debt through 1997. At June 30, 1996, the Company had outstanding commitments to provide financing totaling approximately $34,599,000. The Company intends to fund these commitments with a combination of cash on hand, amounts available under its existing credit facilities and/or proceeds of mortgage prepayments, if any. The Company continues to seek new investments to expand and diversify its portfolio of leased and mortgaged health care related real estate. The Company intends to balance the use of debt and equity in such a manner that the long term cost of funds used to acquire or mortgage finance facilities is appropriately matched, to the extent practicable, with the terms of the investments made with such funding. As of June 30, 1996, the Company's debt as a percentage of total market capitalization was approximately 22%. 7 HEALTH AND RETIREMENT PROPERTIES TRUST MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION CERTAIN IMPORTANT FACTORS The Company's Quarterly Report on Form 10-Q contains statements which constitute forward looking statements. Those statements appear in a number of places in this Form 10-Q and include statements regarding the intent, belief or expectations of the Company, its Trustees or its officers with respect to the consummation of additional acquisitions and financings, the funding of the Company's commitments, policies and plans of the Company regarding investments, financings or other matters. Readers are cautioned that any such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contained in the forward looking statements as a result of various factors. Such factors include without limitation changes in financing terms, the Company's ability or inability to complete acquisitions and financing transactions and general changes in economic conditions not presently contemplated. The information contained in this Form 10-Q and the Company's Annual Report on Form 10-K for the year ended December 31, 1995, including the information under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations", identifies other important factors that could cause such differences. Part II Other Information Item 4. Submission of Matters to a Vote of Securities Holders. The Company's Annual Shareholders Meeting commenced on May 14, 1996 and adjourned in part until June 28, 1996. Barry M. Portnoy and Bruce M. Gans, M.D., were re-elected to serve as Trustees in Group I on the Board of Trustees. There were 55,017,630 and 54,988,845 shares, respectively, voted in favor of, and 372,388 and 401,173 shares, respectively, withheld from voting for the re-election of Barry M. Portnoy and Bruce M. Gans, M.D., and 150,250 shares not voted with respect to each such Trustee. Trustees in Group II and III, Ralph J. Watts, Rev. Justinian Manning, C.P. and Gerard M. Martin, continued in office as Trustees after the meeting. As previously reported, on June 28, 1996 the shareholders approved an amendment to the Declaration of Trust to allow the Board of Trustees to increase or decrease the authorized capital shares of the Company. There were 33,474,724 shares voted in favor of, 6,378,103 shares voted against, 1,409,607 votes abstaining and 19,945,774 shares not voting with respect to the amendment to the Company's Declaration of Trust. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: 27. Financial Data Schedule (b) Reports on Form 8-K: The Company filed a current report on Form 8-K, dated July 9, 1996 relating to the shareholders approval of the amendment to the Trust's Amended and Restated Declaration of Trust described in Item 4 of this Part II. 8 HEALTH AND RETIREMENT PROPERTIES TRUST SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. HEALTH AND RETIREMENT PROPERTIES TRUST By: /S/ David J. Hegarty David J. Hegarty President and Chief Operating Officer Dated: August 15, 1996 By: /S/ Ajay Saini Ajay Saini Treasurer and Chief Financial Officer Dated: August 15, 1996 9 -----END PRIVACY-ENHANCED MESSAGE-----