10-K/A 1 c89797e10vkza.htm FORM 10-K/A Form 10-K/A
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Amendment No. 2)
(Mark One)
     
þ   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2008
OR
     
o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                      to                     
     
Commission file numbers:
  1-13130 (Liberty Property Trust)
 
  1-13132 (Liberty Property Limited Partnership)
 
LIBERTY PROPERTY TRUST
LIBERTY PROPERTY LIMITED PARTNERSHIP
 
(Exact Names of Registrants as Specified in Their Governing Documents)
     
MARYLAND (Liberty Property Trust)   23-7768996
PENNSYLVANIA (Liberty Property Limited Partnership)   23-2766549
     
(State or Other Jurisdiction   (I.R.S. Employer
of Incorporation or Organization)   Identification Number)
     
500 Chesterfield Parkway    
Malvern, Pennsylvania   19355
     
(Address of Principal Executive Offices)   (Zip Code)
     
Registrants’ Telephone Number, including Area Code   (610) 648-1700
     
Securities registered pursuant to Section 12(b) of the Act:
     
    NAME OF EACH EXCHANGE
TITLE OF EACH CLASS   ON WHICH REGISTERED
     
Common Shares of Beneficial Interest,    
$0.001 par value    
(Liberty Property Trust)   New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
YES þ     NO o
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.
YES o     NO þ
Indicate by check mark whether the Registrants (1) have 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 Registrants were required to file such reports) and (2) have been subject to such filing requirements for the past ninety (90) days.
YES þ     NO o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K is not contained herein, and will not be contained, to the best of the Registrants’ 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. þ
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes o No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
             
Large Accelerated Filer þ   Accelerated Filer o   Non-Accelerated Filer o   Smaller Reporting Company o
    (Do not check if a smaller reporting company)
Indicate by check mark if the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES o     NO þ
The aggregate market value of the Common Shares of Beneficial Interest, $0.001 par value (the “Common Shares”), of Liberty Property Trust held by non-affiliates of Liberty Property Trust was $3.1 billion, based upon the closing price of $33.15 on the New York Stock Exchange composite tape on June 30, 2008. Non-affiliate ownership is calculated by excluding all Common Shares that may be deemed to be beneficially owned by executive officers and trustees, without conceding that any such person is an “affiliate” for purposes of the federal securities laws.
Number of Common Shares outstanding as of February 23, 2009: 101,348,063
Documents Incorporated by Reference
Portions of the proxy statement for the annual meeting of shareholders of Liberty Property Trust to be held in 2009 are incorporated by reference into Part III of this Form 10-K.
 
 

 

 

EXPLANATORY NOTE
Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust. Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership”) and, together with the Trust and their consolidated subsidiaries, the “Company”). The Company is filing this 10-K/A (Amendment No. 2) to revise certain items included in its Annual Report on Form 10-K for the year ended December 31, 2008, as amended by Amendment No. 1 thereto.
This Amendment No. 2 includes updates to Item 9A and, for the purpose of adding as exhibits updated certifications, Item 15 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (the “Initial 10-K” and, as amended by Amendment No. 1, the “Form 10-K”). This Amendment No. 2 is being filed primarily to provide the disclosure set forth in this Explanatory Note and in Item 9A regarding management’s reevaluation regarding the effectiveness, as of December 31, 2008, of the Operating Partnership’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) and internal control over financial reporting, (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended), as well as management’s conclusion that no such reevaluation was necessary with respect to the Trust. Amendment No. 1 was filed to (i) reflect the adoption of SFAS No. 160; (ii) to correct the Operating Partnership’s accounting under EITF Topic D-98; and (iii) to reflect the results of operations of the Company’s real properties which were sold prior to March 31, 2009 or were held for sale at March 31, 2009, as discontinued operations. All other items of the Company’s Form 10-K remain unchanged. No attempt has been made to update matters in the Form 10-K except to the extent expressly provided above. The Company notes that Items 6, 7 and 8 were amended in Amendment No. 1.
The Company’s management has considered whether the adjustments to the Company’s financial statements reflected in Amendment No. 1, and in particular the proper application of EITF D-98 by the Operating Partnership, affect management’s conclusion, set forth in the Form 10-K, regarding the effectiveness, as of December 31, 2008, of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) and the Company’s internal control over financial reporting, (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended).
Management concluded that the Trust’s application of EITF D-98 was historically correct. In light of that conclusion, and because neither the adoption of SFAS No. 160 nor the reclassification of certain items to discontinued operations in accordance with SFAS No. 144 caused the Company to reevaluate its disclosure controls and procedures and internal control over financial reporting, management therefore did not reevaluate the Trust’s disclosure controls and procedures or its internal control over financial reporting in connection with preparing Amendment No. 1 or this Amendment No. 2.
Management did reevaluate the Operating Partnership’s disclosure controls and procedures and its internal control over financial reporting in connection with preparing Amendment No. 1. This reevaluation was undertaken solely in connection with revisions, reflected in Amendment No. 1, to the Operating Partnership’s financial statements as a result of the revised application of EITF D-98, as discussed below, and not because of the adoption of SFAS No. 160 or the reclassification of certain items to discontinued operations in accordance with SFAS No. 144.
The determination to make revisions to the application of EITF D-98 with respect to the Operating Partnership’s financial statements was arrived at as follows: In preparing the Operating Partnership’s financial statements included in the Initial 10-K, the Company applied EITF D-98 in a manner consistent with its past practice and what it believed was, and in some cases may continue to be, typical practice in the industry. In auditing such financial statements, the Company’s independent registered public accountants also concluded that such application was appropriate. Upon further consideration of EITF D-98 in connection with preparing the Operating Partnership’s financial statements included in Amendment No. 1, the Company concluded that its prior application of EITF D-98 with respect to such financial statements required revision, which revision was reflected in the Operating Partnership’s financial statements included in Amendment No. 1. However, Company management believes that the initial preparation of the Operating Partnership’s financial statements included in the Initial 10-K reflected an application of EITF D-98 that was based on information then available to the Company, and was arrived at utilizing procedures and processes indicative of disclosure controls and procedures and internal control over financial reporting that were operating effectively as of December 31, 2008. While the Company has subsequently altered its application of EITF D-98 to the Operating Partnership’s financial statements, management has nevertheless concluded that, as of December 31, 2008:
  •   The Operating Partnership’s disclosure controls and procedures were functioning effectively to provide reasonable assurance that information required to be disclosed by the Operating Partnership in its reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms and (ii) accumulated and communicated to the Operating Partnership’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure; and
 
  •   The Operating Partnership’s internal control over financial reporting was effective based on the criteria on which it was evaluated, as described in the Form 10-K.

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INDEX
         
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Exhibit Index
        

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ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. The disclosure controls and procedures of the Operating Partnership were reevaluated by Company management in connection with the filing of Amendment No. 1. See “Explanatory Note” on page 2 of this Amendment No. 2.
Based on this evaluation and reevaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this report, were functioning effectively to provide reasonable assurance that information required to be disclosed by the Company in its reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar function, as appropriate to allow timely decisions regarding required disclosure.
Management’s Annual Reports on Internal Control Over Financial Reporting
Management’s Annual Report on Internal Control Over Financial Reporting with respect to the Trust appears on page 42 of the Initial 10-K.
In connection with the filing of Amendment No. 1, management reevaluated the Operation Partnership’s internal control over financial reporting and concluded that its conclusions as set forth on page 84 of the Initial 10-K remained appropriate.

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Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal control over financial reporting during the quarter ended December 31, 2008 that have materially affected or are reasonable likely to materially affect the Company’s internal control over financial reporting.
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following consolidated financial statements of Liberty Property Trust and Liberty Property Limited Partnership are included in Item 8.
1. REPORTS OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND CONSOLIDATED FINANCIAL STATEMENTS
Management’s Annual Report on Internal Control Over Financial Reporting — Liberty Property Trust
Reports of Independent Registered Public Accounting Firm — Liberty Property Trust
Financial Statements — Liberty Property Trust
Balance Sheets:
Liberty Property Trust Consolidated as of December 31, 2008 and 2007
Statements of Operations:
Liberty Property Trust Consolidated for the years ended December 31, 2008, 2007, and 2006
Statements of Shareholders’ Equity:
Liberty Property Trust Consolidated for the years ended December 31, 2008, 2007, and 2006
Statements of Cash Flows:
Liberty Property Trust Consolidated for the years ended December 31, 2008, 2007, and 2006
Notes to Consolidated Financial Statements — Liberty Property Trust
Management’s Annual Report on Internal Control Over Financial Reporting — Liberty Property Limited Partnership
Reports of Independent Registered Public Accounting Firm — Liberty Property Limited Partnership
Financial Statements — Liberty Property Limited Partnership
Balance Sheets:
Liberty Property Limited Partnership Consolidated as of December 31, 2008 and 2007
Statements of Operations:
Liberty Property Limited Partnership Consolidated for the years ended December 31, 2008, 2007, and 2006
Statements of Owners’ Equity:
Liberty Property Limited Partnership Consolidated for the years ended December 31, 2008, 2007, and 2006
Statements of Cash Flows:
Liberty Property Limited Partnership Consolidated for the years ended December 31, 2008, 2007, and 2006
Notes to Consolidated Financial Statements — Liberty Property Limited Partnership
2. FINANCIAL STATEMENT SCHEDULES:
Schedule III — Real Estate and Accumulated Depreciation as of December 31, 2008 for Liberty Property Trust
All other schedules are omitted because they are either not required or the required information is shown in the financial statements or notes thereto.
Schedule III — Real Estate and Accumulated Depreciation as of December 31, 2008 for Liberty Property Limited Partnership

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All other schedules are omitted because they are either not required or the required information is shown in the financial statements or notes thereto.
3. EXHIBITS:
The following exhibits are filed herewith or are incorporated by reference to exhibits previously filed.
     
EXHIBIT NO.   DESCRIPTION
 
31.1*
  Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
 
    
31.2*
  Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
 
    
31.3*
  Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
 
    
31.4*
  Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
 
    
32.1*
  Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
 
    
32.2*
  Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
 
    
32.3*
  Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
 
    
32.4*
  Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
 
     
*   Filed herewith

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
         
  LIBERTY PROPERTY TRUST
 		  
  By:   /s/ George J. Alburger, Jr.    
  George J. Alburger, Jr.   
  Chief Financial Officer   
 
  LIBERTY PROPERTY LIMITED PARTNERSHIP
 		  
  By:   Liberty Property Trust, it’s sole    
  General Partner   
     
  By:   /s/ George J. Alburger, Jr.    
  George J. Alburger, Jr.   
  Chief Financial Officer   
 
Dated: September 17, 2009

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