-----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, DUmmSR9UgMSnaJyKa3Iqy3NGvYUO3VP+gCrvVgKA+Lrmd9PwVKpQpGYg5kzZhT7a 7nWWvzTfoZAig1CzOYj3oA== 0000899243-96-000988.txt : 19960808 0000899243-96-000988.hdr.sgml : 19960808 ACCESSION NUMBER: 0000899243-96-000988 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960807 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: WEINGARTEN REALTY INVESTORS /TX/ CENTRAL INDEX KEY: 0000828916 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 741464203 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09876 FILM NUMBER: 96605197 BUSINESS ADDRESS: STREET 1: 2600 CITADEL PLZ DR STREET 2: P O BOX 924133 CITY: HOUSTON STATE: TX ZIP: 77292-4133 BUSINESS PHONE: 7138666000 MAIL ADDRESS: STREET 1: 2600 CITADEL PLAZA DR STREET 2: P O BOX 924133 CITY: HOUSTON STATE: TX ZIP: 77292-4133 10-Q 1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-Q (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 1-9876 WEINGARTEN REALTY INVESTORS --------------------------- (Exact name of registrant as specified in its charter) Texas 74-1464203 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2600 Citadel Plaza Drive, P.O. Box 924133, Houston, Texas 77292-4133 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (713) 866-6000 (Former name, former address and former fiscal year, if changed report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X . No . ---------- ----------- APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes . No . --------- ----------- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. As of July 30, 1996, there were 26,545,424 common shares of beneficial interest of Weingarten Realty Investors, $.03 par value, outstanding. PART 1 FINANCIAL INFORMATION ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS WEINGARTEN REALTY INVESTORS STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED) (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended Six Months Ended June 30, June 30, ------------------ ---------------- 1996 1995 1996 1995 ------- ------- ------ ------ Revenues: Rentals $35,832 $30,304 $70,802 $60,002 Interest: Securities and Other 342 797 800 1,574 Affiliates 406 721 822 1,405 Equity in earnings of real estate joint ventures and partnerships 366 393 770 778 Other 232 444 746 992 ------- ------- ------- ------- Total 37,178 32,659 73,940 64,751 ------- ------- ------- ------- Expenses: Depreciation and amortization 8,179 7,273 16,270 14,300 Operating 5,698 5,019 11,081 9,942 Ad valorem taxes 4,799 4,225 9,580 8,455 Interest 5,310 4,008 10,321 7,422 General and administrative 1,183 1,157 2,550 2,432 ------- ------- ------- ------- Total 25,169 21,682 49,802 42,551 ------- ------- ------- ------- Income from Operations 12,009 10,977 24,138 22,200 Gain (Loss) on sales of property 901 (46) 1,397 95 ------- ------- ------- ------- Net Income $12,910 $10,931 $25,535 $22,295 ======= ======= ======= ======= Net Income per Common Share $0.48 $0.41 $0.96 $.84 ======= ======= ======= ======= Cash Dividends Declared per Common Share $0.62 $0.60 $1.24 $1.20 ======= ======= ======= ======= Weighted Average Number of Common Shares Outstanding 26,544 26,423 26,545 26,396 ======= ======= ======= =======
See notes to consolidated financial statements. 2 WEINGARTEN REALTY INVESTORS CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
June 30, December 31, 1996 1995 ----------- ------------ ASSETS (unaudited) Property $ 889,338 $ 849,894 Accumulated depreciation (229,190) (216,657) --------- --------- Property - net 660,148 633,237 Investment in Real Estate Joint Ventures and Partnerships 8,639 8,960 --------- --------- Total 668,787 642,197 Mortgage Bonds and Notes Receivable from: Affiliate (net of deferred gain of $5,514) 16,358 15,863 Real Estate Joint Ventures and Partnerships 14,091 13,897 Marketable Debt Securities 14,792 16,262 Unamortized Debt and Lease Costs 21,443 20,602 Accrued Rent and Accounts Receivable (net of allowance for doubtful accounts of $987 in 1996 and $1,436 in 1995) 10,131 13,357 Cash and Cash Equivalents 1,950 3,355 Other 6,428 9,291 --------- --------- Total $ 753,980 $ 734,824 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Debt $ 321,549 $ 289,339 Accounts Payable and Accrued Expenses 25,591 30,880 Other 2,778 3,006 --------- --------- Total 349,918 323,225 ========= ========= Shareholders' Equity: Preferred shares of beneficial interest-par value, $0.03 per share; shares authorized: 10,000; shares issued and outstanding: none Common shares of beneficial interest - par value, $0.03 per share; shares authorized: 150,000; shares issued and outstanding: 26,545 in 1996 and 26,546 in 1995 796 796 Capital surplus 403,266 410,803 --------- --------- Shareholders' equity 404,062 411,599 --------- --------- Total $ 753,980 $ 734,824 ========= =========
See notes to consolidated financial statements. 3 WEINGARTEN REALTY INVESTORS STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED) (AMOUNTS IN THOUSANDS)
Six Months Ended June 30, ---------------- 1996 1995 ---- ---- Cash Flows from Operating Activities: Net income $ 25,535 $ 22,295 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 16,270 14,300 Equity in earnings of real estate joint ventures and partnerships (770) (778) Gain on sales of property (1,397) (95) Amortization of direct financing leases 340 331 Changes in accrued rents and accounts receivable 2,440 3,175 Changes in other assets (3,678) (2,747) Changes in accounts payable and accrued expenses (5,499) (6,216) Other, net 39 41 -------- -------- Net cash provided by operating activities 33,280 30,306 -------- -------- Cash Flows from Investing Activities: Investment in properties (34,536) (39,400) Mortgage bonds and notes receivable: Advances (921) (2,243) Collections 3,772 1,679 Proceeds from sales of property 1,836 184 Real estate joint ventures and partnerships: Investments (29) (40) Distributions 740 815 Proceeds from investment in marketable debt securities 1,595 1,300 -------- -------- Net cash used in investing activities (27,543) (37,705) -------- -------- Cash Flows from Financing Activities: Proceeds from issuance of: Debt 27,500 146,112 Common shares of beneficial interest 118 Principal payments of debt (1,755) (106,273) Dividends paid (32,916) (31,641) Other (89) (269) ------- -------- Net cash (used in) provided by financing activities (7,142) 7,929 ------- -------- Net (decrease) increase in cash and cash equivalents (1,405) 530 Cash and cash equivalents at January 1 3,355 3,295 -------- --------- Cash and cash equivalents at June 30 $ 1,950 $ 3,825 ======== =========
See notes to consolidated financial statements. 4 WEINGARTEN REALTY INVESTORS NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (AMOUNTS IN THOUSANDS) 1. INTERIM FINANCIAL STATEMENTS The consolidated financial statements included in this report are unaudited, except for the balance sheet as of December 31, 1995. In the opinion of the Registrant, all adjustments necessary for a fair presentation of such financial statements have been included. Such adjustments consisted of normal recurring items. Interim results are not necessarily indicative of results for a full year. The consolidated financial statements and notes are presented as permitted by Form 10-Q, and do not contain certain information included in the Company's annual financial statements and notes. 2. SIGNIFICANT ACCOUNTING POLICIES Effective January 1, 1996, the Company adopted Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation". As allowed under this statement, the Company has continued to use the intrinsic value based method of accounting for such plans. Also effective January 1, 1996, the Company adopted SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed Of". The adoption of this standard did not result in the impairment of any of the Company's long-lived assets. 3. DEBT The Company's debt consists of the following: June 30, December 31, 1996 1995 -------- ----------- Fixed-rate debt payable to 2015 at 6.0% to 10.5% $188,855 $189,413 Notes payable under revolving credit agreement 101,000 73,500 Reverse repurchase agreements, due daily and collateralized by $14.8 million of marketable debt securities 11,300 11,900 Industrial revenue bonds to 2014 at 4.0% to 6.6% at June 30, 1996 7,613 7,669 Obligations under capital leases 12,467 6,001 Other 314 856 -------- -------- Total $321,549 $289,339 ======== ======== At June 30, 1996, the variable interest rates for notes payable under the revolving credit agreement and the reverse repurchase agreements were 6.1% and 5.8%, respectively. The weighted average interest rate for the Company's short-term debt for the period ended June 30, 1996 was 6.0%. In June the Company obtained an unsecured, uncommitted overnight credit facility totaling $15 million with a bank to be used for cash management purposes. Subsequent to quarter-end, the Company issued $30.0 million of unsecured Medium Term Notes in two $15.0 million tranches. These tranches have maturities of seven and twelve years and bear interest at 7.06% and 7.47%, respectively. The proceeds from these transactions were used to pay down balances outstanding under the Company's revolving credit facility. 5 The Company's debt can be summarized as follows: June 30, December 31, 1996 1995 --------- ------------ As to interest rate: Fixed-rate debt (including amounts fixed through interest rate swaps) $228,899 $229,994 Variable-rate debt 92,650 59,345 -------- -------- Total $321,549 $289,339 ======== ======== As to collateralization: Secured debt $ 92,435 $ 87,133 Unsecured debt 229,114 202,206 -------- -------- Total $321,549 $289,339 ======== ======== 4. PROPERTY The Company's property consists of the following: June 30, December 31, 1996 1995 -------- ----------- Land $159,605 $151,985 Land under development 38,684 40,464 Buildings and improvements 668,430 636,601 Construction in-progress 14,058 11,648 Property under direct financing leases 8,561 9,196 -------- -------- Total $889,338 $849,894 ======== ======== 6 5. CARRYING CHARGES CAPITALIZED During the periods shown, the following carrying charges were capitalized: Three Months Ended Six Months Ended June 30, June 30, ------------------ ---------------- 1996 1995 1996 1995 ---- ---- ---- ---- Interest $ 390 $ 762 $ 817 $1,546 Ad valorem taxes 112 119 231 241 ----- ----- ------ ------ Total $ 502 $ 881 $1,048 $1,787 ===== ===== ====== ====== 6. SUBSEQUENT EVENT On August 6, 1996, the Company sold its interest in an apartment complex. Proceeds of approximately $5.3 million were received, pending final settlement of miscellaneous assets and liabilities, resulting in a gain of approximately $3.9 million. 7 PART 1 FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. Weingarten Realty Investors owned and operated 155 anchored shopping centers, 18 industrial properties, two multi-family residential projects, and one office building at June 30, 1996. Of the Company's 176 developed properties, 136 are located in Texas (including 87 in Houston and Harris County). The Company's remaining properties are located in Louisiana (10), Arizona (7), Arkansas (5), New Mexico (5), Oklahoma (4), Nevada (4), Kansas (2), Missouri (1), Maine (1) and Tennessee (1). The Company has nearly 2,900 leases and 2,200 different tenants. Leases for the Company's properties range from less than a year for smaller spaces to over 25 years for larger tenants; leases generally include minimum lease payments and contingent rentals for payment of taxes, insurance and maintenance and for an amount based on a percentage of the tenants' sales. The majority of the Company's anchor tenants are supermarket chains, drugstore chains and other retailers which generally sell basic necessity-type items. During the first six months of 1996, the Company renewed or released 911,000 square feet of retail space comprising 268 leases. Net of capital costs for tenant improvements, rental rates increased an average of 5.4% over the rates charged to the prior tenants. Retail sales on the same store basis as reported by the Company's tenants for the six months ended June 30, 1996 were up 1.3%, with supermarket operators also up approximately 1.2% as compared to the same period of the prior year. Occupancy as of June 30, 1996 for shopping centers and the total portfolio stands at 92%, unchanged from year end and the end of the second quarter of 1995. Acquisitions added 236,000 square feet to the Company's portfolio during the second quarter of 1996 at a combined cost of $9.1 million. A 135,000 square foot shopping center located in a suburb of Kansas City was purchased in April, the Company's third center in this market. The Company also purchased a 101,000 square foot office/service center in Houston. Presently, eight additional properties totaling over 1.3 million square feet are under contract or letter of intent, however there is no assurance that these transactions will be completed. Leasing activity at the Company's two high-profile new development projects in Houston is progressing as scheduled, with both centers over 90% leased. Construction of these centers is generally complete except for tenant finish work, which will be completed as the last few spaces are leased. The majority of the 300,000 square feet from these two projects came on line prior to year- end 1995. The Company has also completed construction of a 30,000 square foot specialty center in the Galleria area of Houston, which opened in May. FUNDS FROM OPERATIONS The Company considers funds from operations to be an alternate measure of the performance of an equity REIT since such measure does not recognize depreciation and amortization of real estate assets as operating expenses. Management believes that reductions for these charges are not meaningful in evaluating income-producing real estate, which historically has not depreciated. The National Association of Real Estate Investment Trusts defines funds from operations as net income plus depreciation and amortization of real estate assets, less gains and losses on sales of properties. Funds from operations does not represent cash flows from operations as defined by generally accepted accounting principles and should not be considered as an alternative to net income as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. Funds from operations increased to $20.1 million for the second quarter of 1996, as compared to $18.2 million for the same period of 1995, a 10.4% increase. For the six months ended June 30, 1996, funds from operations totaled $40.3 million, up $3.9 million from the same period of the prior year. These increases relate primarily to the impact of the Company's acquisitions and new developments during the past 12 months and, to a lesser degree, the activity at its existing properties. 8 LIQUIDITY AND CAPITAL RESOURCES The Company anticipates that cash flows from operating activities will continue to provide adequate capital for all dividend payments in accordance with REIT requirements, and that cash on hand, borrowings under its existing credit facility, and the use of project financing as well as other debt and equity alternatives will provide the necessary capital to achieve growth. Cash flow from operating activities as reported in the Statements of Consolidated Cash Flows increased to $33.2 million for the first six months of 1996, from $30.3 million for the same period of 1995, primarily due to the acquisition and development of additional income-producing properties during the past year. The Company's Board of Trust Managers approved an increase in the quarterly dividend per common share from $.60 to $.62, effective the first quarter of 1996. The percentage of funds from operations paid out in cash dividends, or dividend payout ratio, was 81.6% and 87.0% for the second quarters of 1996 and 1995, respectively. Debt to total market capitalization of 24% at June 30, 1996 was up slightly from 22% at December 31, 1995. Total debt outstanding increased to $321.5 million at quarter-end from $289.3 million at December 31, 1995. This increase was primarily due to the acquisitions in the first six months of this year and, to a lesser degree, the Company's ongoing development efforts. These capital needs were initially financed under the Company's revolving credit facility. In June, the Company executed an agreement for an unsecured and uncommitted overnight credit facility totaling $15 million with a bank to be used for cash management purposes. The Company will maintain adequate funds available under its $200 million revolving credit facility at all times to payoff the outstanding balance under this facility. Subsequent to quarter-end, the Company issued $30.0 million of unsecured Medium Term Notes in two $15.0 million tranches. These tranches have maturities of seven and twelve years and bear interest at 7.06% and 7.47%, respectively. The proceeds from these transactions were used to pay down balances outstanding under the Company's revolving credit facility. At quarter-end, the Company has protection against interest rate increases through fixed-rate loans and interest rate swap agreements on $228.9 million of the total debt outstanding at June 30, 1996. The issuance of the Medium Term Notes subsequent to quarter-end will increase the amount protected against interest rate fluctuations by an additional $30.0 million. For the quarter ended June 30, 1996, total debt costs averaged 7.2% as compared to 7.6% for the same period of the prior year. This decrease is primarily a result of overall decreases in market interest rates over the last 12 months. RESULTS OF OPERATIONS QUARTER ENDED JUNE 30, 1996 Net income increased to $12.9 million, or $.48 per share, from $10.9 million, or $.41 per share, for the second quarter of 1996 as compared with the same quarter of 1995, an increase of 17.1% on a per share basis. Of this increase, $.9 million, or $.03 per share, represents the impact of gains from the disposition of property and the receipt of proceeds from an insurance claim. The remainder of the increase relates primarily to the Company's acquisitions and new developments during the past 12 months. Rental revenues were $35.8 million for 1996, as compared to $30.3 million for 1995, representing an increase of approximately $5.5 million or 18.2%. This increase relates primarily to acquisitions and new development and, to a lesser degree, the activity at the Company's existing properties. Interest income decreased from $1.5 million in 1995 to $.7 million in 1996 due primarily to the sale of $31.8 million of marketable debt securities in November of 1995. 9 Interest expense increased $1.3 million to $5.3 million in 1996, from $4.0 million in 1995. This increase was due to an increase in average debt outstanding between periods, from $249.3 million in 1995 to $313.7 million in 1996, partially offset by a decrease in the average interest rate during the quarter from 7.6% in 1995 to 7.2% in 1996. Also contributing to the increase was a reduction in construction activity at two of the Company's significant new development projects which were nearing completion, resulting in a decrease in the amount of interest capitalized from $.8 million in 1995 to $.4 million in 1996. The increase in the gain on sale of property to $.9 million in 1996 is due to the receipt of insurance proceeds from a fire which destroyed a part of a shopping center and the sale of a property. The increases in depreciation and amortization, operating expenses and ad valorem taxes were primarily the result of the Company's acquisition and new development programs. SIX MONTHS ENDED JUNE 30, 1996 Net income increased to $25.5 million, or $.96 per share, for the six months ended June 30, 1996 from $22.3 million, or $.84 per share for 1995. Included in 1996 net income is $1.7 million, or about $.06 per share, of gains from the disposition of property and receipt of proceeds from an insurance claim as well as other non-recurring income items recognized in the first six months of the year compared to $.3 million, or about $.01 per share, of non-recurring lease cancellation income recognized in 1995. The remainder of the increase is due primarily to the Company's acquisition and new development programs. Rental revenues increased 18.0% to $70.8 million, compared with $60.0 million for the same period of the prior year. This increase relates primarily to acquisitions and new development and, to a lesser degree, the activity at the Company's existing properties. Interest income decreased from $3.0 million in 1995 to $1.6 million in 1996 due primarily to the sale of marketable debt securities in 1995. Interest expense increased from $7.4 million for the first six months of 1995 to $10.3 million for the same period of 1996. Average debt outstanding increased from $240.1 million for 1995 to $303.6 million for 1996. The effect of the increase in average debt outstanding was partially offset by a slight decrease in the average interest rate from 7.4% in 1995 to 7.3% in 1996. The increase in debt outstanding is a result of expenditures for acquisitions and new development. The decrease in rate is a result of overall decreases in market rates. Also contributing to the increase in interest expense was the decrease in the amount of interest capitalized from $1.5 million in 1995 to $.8 million in 1996 as a result of the reduction in construction activity at two of the Company's significant development projects which were nearing completion. The increase in the gain on sale of property from $.1 million in 1995 to $1.4 million in 1996 is due to the receipt of insurance proceeds from fires which destroyed part of two shopping centers and the sale of a property. The increase in depreciation and amortization, operating expenses and ad valorem taxes were primarily the result of the Company's acquisition and new development programs. 10 PART II OTHER INFORMATION ITEM 1. THROUGH 5. - NONE ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits (numbered in accordance with Item 601 of Regulation S-K) (10.33) Revolving Credit Note, dated June 25, 1996, between the Company and Texas Commerce Bank National Association in the amount of $15,000,000. (11) A statement of computation of earnings per common share. (12) A statement of computation of ratios of earnings and funds from operations to fixed charges. (27) Article 5 Financial Data Schedule (EDGAR filing only). (b) Reports on Form 8-K No reports on Form 8-K have been filed by the Registrant during the quarter for which this report is filed. 11 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. WEINGARTEN REALTY INVESTORS ---------------------------- (Registrant) BY: /s/ Stanford Alexander ------------------------ Stanford Alexander Chairman/Chief Executive Officer (Principal Executive Officer) BY: /s/ Stephen C. Richter ------------------------- Stephen C. Richter Vice President/Financial Administration and Treasurer (Principal Accounting Officer) DATE: August 7, 1996 -------------- 12 EX-10.33 2 PROMISSORY NOTE EXHIBIT 10.33 MASTER PROMISSORY NOTE --------------- (this"Note") June 25, 1996 FOR VALUE RECEIVED, the undersigned, WEINGARTEN REALTY INVESTORS ("Company") promises to pay to the order of TEXAS COMMERCE BANK NATIONAL ASSOCIATION ("Bank"), on or before June 16, 1997 ("Final Maturity Date") at its offices located at 712 Main Street Houston, Texas 77002 in lawful money of the United States of America and in immediately available funds, the principal amount of each loan (a "Loan") shown in Bank's records to have been made by Bank and on the relevant maturity date as set forth in Bank's records. Each Loan shall also have its own date of maturity agreed by Company and Bank which will occur prior to the Final Maturity Date. The rate of interest on each Loan evidenced hereby from time to time shall be the interest rate which shall be determined for each Loan by agreement between Company and Bank but, in no event, shall exceed the maximum interest rate permitted under applicable law ("Highest Lawful Rate"). If Texas law determines the Highest Lawful Rate, Bank has elected the "indicated" (weekly) ceiling as defined in the Texas Credit Code or any successor statute. All past due amounts shall bear interest at a per annum interest rate equal to the Prime Rate plus one percent (1%). The term "Prime Rate" shall mean the prime rate as determined from time to time by Bank and thereafter entered in the minutes of Bank's Loan and Discount Committee, fluctuating upward or downward automatically, without notice to Company on the business day of each such determination. THE PRIME RATE IS A REFERENCE RATE AND BANK MAY MAKE LOANS AT RATES OF INTEREST AT, ABOVE OR BELOW THE PRIME RATE. Interest on each Loan shall be: (i) computed on the unpaid principal amount of the Loan outstanding from the date of advance until paid; (ii) payable at maturity and thereafter on demand; and (iii) shall be calculated on the basis of a year of 360 days for the actual days elapsed. The total amount of interest (as defined under applicable law) contracted for, charged or collected under this Note will never exceed the Highest Lawful Rate. If Bank contracts for, charges or receives any excess interest, it will be deemed a mistake. Bank will automatically reform the contract or charge to conform to applicable law, and if excess interest has been received, Bank will either refund the excess or credit the excess on the unpaid principal amount of this Note. All amounts constituting interest will be spread throughout the full term of this Note in determining whether interest exceeds lawful amounts. Each of the following is an event of default ("Events of Default"): (a) Company shall fail to pay any amount of principal of or interest on this Note when due; (b) Company shall fail to pay when due any amount of principal or interest with respect to any obligation to Bank (other than this Note); or (c) Company shall fall to pay any amount relating to any other recourse indebtedness in excess of $10,000,000 for borrowed money or other pecuniary obligation (including any contingent such obligation) or an event or condition shall occur or exist which gives the holder of any such indebtedness or obligation the right or option to accelerate the maturity thereof. (d) Company shall commence any bankruptcy, reorganization or similar case or proceeding relating to it or its property under the law of any jurisdiction, or a trustee or receiver shall be appointed for itself or any substantial part of its property; (e) any involuntary bankruptcy, reorganization or similar case or proceeding under the law of any jurisdiction shall have been commenced against Company or any substantial part of its property and such case or proceeding shall not have been dismissed within 60 days, or Company shall have consented to such case or proceeding; or (f) Company shall admit in writing its inability to pay its debts as they become due. Upon the happening of any Event of Default specified in paragraphs (d), (e) or (f) above, automatically the Loans evidenced by this Note (with accrued interest thereon) shall immediately become due and payable, and upon the happening of an Event of Default specified in paragraphs (a), (b) or (c) above, Bank may, by notice to Company, declare the Loans evidenced by this Note (with accrued interest thereon) to be due and payable, whereupon the same shall immediately become due and payable. Except as expressly provided above, presentment, demand, protest, notice of intent to accelerate, acceleration and all other notices of any kind are hereby expressly waived The Company hereby agrees to pay on demand, in addition to unpaid principal and interest, all Bank's costs and expenses incurred in attempting or effecting collection hereunder, including the reasonable fees and expenses of counsel (which may include, to the extent permitted by applicable law, allocated costs of in-house counsel), whether or not suit is instituted This Note is executed and delivered by Company to evidence Loans which may be made by Bank to Company not to exceed $15,000,000.00. COMPANY UNDERSTANDS THAT BANK HAS NO OBLIGATION TO MAKE ANY LOAN TO COMPANY UNDER THIS NOTE. All Loans evidenced by this Note are and will be for business and commercial purposes and no Loan will be used for the purpose of purchasing or carrying any margin stock as that term is defined in Regulation U of the Board of Governors of the Federal Reserve System (the "Board"). Chapter 15 of the Texas Credit Code does not apply to this Note or to any Loan evidenced by this Note. This Note shall be governed by the laws of the State of Texas and the laws of the United States as applicable. Bank shall, and is hereby authorized by Company, to record in its records the date, amount, interest rate and due date of each Loan as well as the date and amount of each payment by the undersigned in respect thereof. Payments may be applied to accrued interest or principal in whatever order Bank chooses. Loans evidenced by this Note may not be prepaid. In the event any such prepayment occurs, Company shall indemnify Bank against any loss, liability, damage, cost or expense which Bank may sustain or incur as a consequence thereof, including without limitation any loss, liability, damage, cost or expense sustained or incurred in liquidating or employing deposits from third parties acquired to effect or maintain such Loan or any part thereof. Bank shall provide to Company a written statement explaining the amount of any such loss or expense, which statement shall be conclusive absent manifest error. No waiver of any default shall be deemed to be a waiver of any other default. No failure to exercise or delay in exercising any right or power under this Note shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power preclude any further or other exercise thereof or the exercise of any other right or power. No amendment, modification or waiver of this Note shall be effective unless the same is in writing and signed by the person against whom such amendment, modification or waiver is sought to be enforced. No notice to or demand on any person shall entitle any person to any other or further notice or demand in similar or other circumstances. This Note shall be binding upon the successors and assigns of Company and inure to the benefit of Bank, its successors, endorsees and assigns (furthermore, Bank may assign or pledge this Note or any interest therein to any Federal Reserve Bank). If any term or provision of this Note shall be held invalid, illegal or unenforceable the validity of all other terms and provisions will not be affected THIS NOTE 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. NAME: _____________________________________ TITLE: _____________________________________ Executive Vice President Weingarten Realty Investors (the "trust") is an unincorporated trust organized under the Texas Real Estate Investment Trust Act. Neither the shareholders of the trust, nor its trust managers, officers, employees or other agents are personally, corporately or individually liable for any debt, act, omission or obligation of the trust, and all persons having claims of any kind against the trust must look solely to the property of the trust for the enforcement of their rights. (The Bank's signature is provided as its acknowledgment of the above as the final written agreement between the parties.) TEXAS COMMERCE BANK NATIONAL ASSOCIATION By: _______________________________ Name: _______________________________ Title: _______________________________ EX-11 3 COMPUTATION OF EARNINGS PER COMMON SHARE EXHIBIT 11 WEINGARTEN REALTY INVESTORS COMPUTATION OF EARNINGS PER COMMON SHARE (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Three Months Six Months Ended Ended June 30, June 30, --------------- ---------------- 1996 1995 1996 1995 ---- ---- ---- ---- SIMPLE EARNINGS PER SHARE: Weighted Average Common Shares Outstanding 26,544 26,423 26,545 26,396 ======= ======= ======= ======= Simple Earnings Per share $ .48 $ .41 $ .96 $ .84 ======= ======= ======= ======= PRIMARY EARNINGS PER SHARE (NOTE A): Weighted Average Common Shares Outstanding 26,544 26,423 26,545 26,396 Shares Issuable from Assumed Conversion of Common Share Options Granted and Outstanding 30 33 37 53 ------- ------- ------- ------- Weighted Average Common Shares Outstanding, as Adjusted 26,574 26,456 26,582 26,449 ======= ======= ======= ======= Primary Earnings Per Share $ .48 $ .41 $ .96 $ .84 ======= ======= ======= ======= FULLY DILUTED EARNINGS PER SHARE (NOTE A): Weighted Average Common Shares Outstanding 26,544 26,423 26,545 26,396 Shares Issuable from Assumed Conversion of Common Share Options Granted and Outstanding 63 33 63 53 ------- ------- ------- ------- Weighted Average Common Shares Outstanding, as Adjusted 26,607 26,456 26,608 26,449 ======= ======= ======= ======= Fully Diluted Earnings Per Share $ .48 $ .41 $ .96 $ .84 ======= ======= ======= ======= EARNINGS FOR SIMPLE, PRIMARY AND FULLY DILUTED COMPUTATION: Earnings $12,910 $10,931 $25,535 $22,295 ======= ======= ======= ======= - ---------- Note A: This calculation is submitted in accordance with Regulation S-K item 601(b)(11) although not required by footnote 2 to paragraph 14 of APB Opinion No. 15 because it results in dilution of less than 3%. EX-12 4 COMPUTATION OF RATIOS EXHIBIT 12 WEINGARTEN REALTY INVESTORS COMPUTATION OF RATIOS OF EARNINGS AND FUNDS FROM OPERATIONS TO FIXED CHARGES (DOLLAR AMOUNTS IN THOUSANDS)
Three Months Six Months Ended Ended June 30, June 30, ----------------- ----------------- 1996 1995 1996 1995 ------ ------- ------- ------ Net income $12,910 $10,931 $25,535 $22,295 Add: Portion of rents representative of the 164 146 318 310 interest factor Interest on indebtedness 5,310 4,008 10,321 7,422 Amortization of debt cost 80 39 149 69 ------- ------- ------- ------- Net income as adjusted $18,464 $15,124 $36,323 $30,096 ======= ======= ======= ======= Fixed charges: Interest on indebtedness $ 5,310 $ 4,008 $10,321 $ 7,422 Capitalized interest 390 762 817 1,546 Amortization of debt cost 80 39 149 69 Portion of rents representative of the interest factor 164 146 318 310 ------- ------- ------- ------- Fixed charges $ 5,944 $ 4,955 $11,605 $ 9,347 ======= ======= ======= ======= RATIO OF EARNINGS TO FIXED CHARGES 3.11 3.05 3.13 3.22 ======= ======= ======= ======= Net income $12,910 $10,931 $25,535 $22,295 Depreciation and amortization 8,100 7,233 16,122 14,230 (Gain) loss on sales of property (901) 46 (1,397) (95) ------- ------- ------- ------- Funds from operations 20,109 18,210 40,260 36,430 ======= ======= ======= ======= Interest on indebtedness 5,310 4,008 10,321 7,422 ------- ------- ------- ------- Funds from operations (as adjusted) $25,419 $22,218 $50,581 $43,852 ======= ======= ======= ======= RATIO OF FUNDS FROM OPERATIONS TO FIXED CHARGES 4.28 4.48 4.36 4.69 ======= ======= ======= =======
EX-27 5 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from Weingarten Realty Investors' quarterly report for the period ended June 30, 1996. 1,000 6-MOS DEC-31-1996 JUN-30-1996 1,950 14,792 11,118 987 0 0 889,338 229,190 753,980 0 0 0 0 796 403,266 753,980 0 73,940 0 11,081 28,400 0 10,321 24,138 0 24,138 0 0 0 25,535 .96 .96
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