-----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, GS9oALZwCJwhNhWJerCTGGQR1kOq3FCNi/1gjEc96IoJucjf8mgy7j753bkOiz0b xpbTzDpzu7ff9bLM0fdq8w== 0001000096-98-000647.txt : 19981103 0001000096-98-000647.hdr.sgml : 19981103 ACCESSION NUMBER: 0001000096-98-000647 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980818 ITEM INFORMATION: FILED AS OF DATE: 19981102 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERIVEST PROPERTIES INC CENTRAL INDEX KEY: 0000927102 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 841240264 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 001-14462 FILM NUMBER: 98736375 BUSINESS ADDRESS: STREET 1: 2801 YOUNGFIELD STREET STREET 2: SUITE 300 CITY: GOLDEN STATE: CO ZIP: 80401 BUSINESS PHONE: (303) 205-7870 MAIL ADDRESS: STREET 1: 7100 GRANDVIEW AVE STREET 2: SUITE 1 CITY: ARVADA STATE: CO ZIP: 80002 8-K/A 1 FORM 8-K/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 8-K/A-1 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): August 18, 1998 AmeriVest Properties Inc. ------------------------- (Exact name of registrant as specified in its charter) Delaware 1-14462 84-1240264 -------- ------- ---------- (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 2801 Youngfield Street, Suite 300, Golden, Colorado 80401 --------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (303) 205-7870 7100 Grandview Avenue, Suite 1, Arvada, Colorado 80002 ------------------------------------------------------ (Former address if changed since last report) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. Financial Statements of Real Estate Properties Acquired Independent Auditor's Report F-1 Combined Statements of Real Estate Operating Revenues and Expenses - year ended December 31, 1997 and six months ended June 30, 1998 (unaudited) F-2 Notes to Financial Statements F-3-4 Unaudited Pro Forma Financial Information Pro Forma Financial Information F-5 Unaudited Pro Forma Consolidated Balance Sheet as of June 30, 1998 F-6 Unaudited Pro Forma Consolidated Statement of Operations - six months ended June 30, 1998 F-7 Unaudited Pro Forma Consolidated Statement of Operations - year ended December 31, 1997 F-8 Notes to Unaudited Pro Forma Consolidated Financial Statements F-9 INDEPENDENT AUDITOR'S REPORT To The Board of Directors and Stockholders AMERIVEST PROPERTIES INC. We have audited the accompanying combined statement of real estate operating revenues and expenses for four Texas real estate properties acquired by AmeriVest Buildings Texas Inc., a wholly owned subsidiary of AmeriVest Properties Inc., for the year ended December 31, 1997. This financial statement is the responsibility of the Company's management. Our responsibility is to express an opinion on this financial statement based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying financial statement was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission and is not intended to be a complete presentation of the real estate operating revenues and expenses of the Texas real estate properties acquired by AmeriVest Buildings Texas Inc. In our opinion, the financial statement referred to above presents fairly, in all material respects, the real estate operating revenues and expenses of the Texas real estate properties acquired by AmeriVest Buildings Texas Inc., for the year ended December 31, 1997 in conformity with generally accepted accounting principles. Wheeler Wasoff, P.C. Denver, Colorado October 22, 1998 F-1 AMERIVEST PROPERTIES INC. TEXAS REAL ESTATE PROPERTIES ACQUIRED COMBINED STATEMENTS OF REAL ESTATE OPERATING REVENUES AND EXPENSES YEAR ENDED DECEMBER 31, 1997 AND SIX MONTHS ENDED JUNE 30, 1998 (Unaudited) Year Ended Six Months Ended December 31,1997 June 30, 1998 (Unaudited) REAL ESTATE OPERATING REVENUES $845,288 $427,727 -------- -------- REAL ESTATE OPERATING EXPENSES Property operating expenses Operating expenses 315,616 157,782 Real estate taxes 77,356 38,678 Management fees 36,000 18,000 General and administrative 1,779 546 -------- -------- 430,751 215,006 -------- -------- NET INCOME FROM REAL ESTATE OPERATIONS $414,537 $212,721 ======== ======== The accompanying notes are an integral part of the financial statement. F-2 AMERIVEST PROPERTIES INC. TEXAS REAL ESTATE PROPERTIES ACQUIRED NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1997 and JUNE 30, 1998 (Unaudited) NOTE 1 - BASIS OF PRESENTATION On August 18, 1998, pursuant to a purchase and sale agreement entered into in June 1998, AmeriVest Properties Inc. (AmeriVest), through its wholly owned subsidiary AmeriVest Buildings Texas Inc. (AmeriVest Buildings) completed the acquisition of 4 office buildings (the Acquired Buildings) in the State of Texas. The aggregate purchase price for the Acquired Buildings of $3.625 million consisted of approximately $1.953 million in cash and the assumption of $1.672 million of existing debt. The real estate operating revenues and expenses presented in the accompanying financial statements relate only to the operations of the Acquired Buildings and do not represent all of the operating costs and expenses of the sellers. Operating expenses include the actual costs of operating and maintaining the Acquired Buildings, but do not include charges for interest, depreciation, federal or state income taxes or general and administrative expenses not directly related to the Acquired Buildings. The amounts of these omitted expenses are not known or reasonably available. The real estate operating expenses for the periods presented may not be indicative of future operation of the Acquired Buildings. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REVENUE RECOGNITION Rental revenue from real estate operations is recognized as earned, on a monthly basis. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. F-3 AMERIVEST PROPERTIES INC. TEXAS REAL ESTATE PROPERTIES ACQUIRED NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1997 and JUNE 30, 1998 (Unaudited) NOTE 3 - LEASE AGREEMENTS The following table summarizes future minimum base rent to be received from noncancelable tenant leases for the Acquired Buildings that expire each year as of December 31: 1998 $ 915,502 1999 786,910 2000 752,462 2001 710,532 2002 710,532 Thereafter 6,778,555 ----------- $10,654,493 =========== NOTE 4 - CONCENTRATIONS The Acquired Buildings are leased primarily (63% in the aggregate) to NationsBank, Texas, N.A., under long-term lease agreements. NOTE 5 - UNAUDITED FINANCIAL STATEMENT The financial statement for the six months ended June 30, 1998 is unaudited; however, in the opinion of management, all adjustments (consisting solely of normal recurring adjustments) necessary to a fair presentation of the financial statement for that interim period have been made. The results of the interim period are not necessarily indicative of the results to be obtained for a full fiscal year. F-4 AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA FINANCIAL INFORMATION In August 1998 AmeriVest, through its wholly owned subsidiary, AmeriVest Buildings Texas Inc., ("AmeriVest Buildings"), acquired four office buildings in the State of Texas. In June and July 1998 AmeriVest had previously acquired, through its wholly owned subsidiaries, AmeriVest Properties Texas Inc. and AmeriVest Properties Odessa Inc., eleven office buildings in Texas. These acquisitions were previously reported on Form 8-K filed as of July 13, 1998. The accompanying pro forma consolidated balance sheet presents, as of June 30, 1998,(i) the historical financial information of AmeriVest as of June 30, 1998 in the "AmeriVest (Historical)" column, (ii) the pro forma financial information reflecting the acquistions of 11 buildings on July 13, 1998 in the "Pro Forma (Previously Reported)" column as if those acquisitions had occurred on June 30, 1998, and (iii) the pro forma combined financial information, as adjusted for the acquisition of the Acquired Buildings by AmeriVest Buildings on August 18, 1998 as if the acquisition had occurred on June 30, 1998, in the "Pro Forma Combined" column. A pro forma balance sheet setting forth the information included in the column entitled "Pro Forma (Previously Reported)" was previoulsy reported in the Company's Form 8-K Report filed as of July 13, 1998. The accompanying pro forma consolidated statements of operations for the six months ended June 30, 1998 and for the year ended December 31, 1997, respectively, combine the pro forma financial information of AmeriVest, which is set forth in the respective "Pro Forma (Previously Reported)" columns and was previously reported on the Form 8-K filed July 13, 1998, with the historical real estate operating revenues and expenses of the four Acquired Buildings as if the acquisitions had occurred at the beginning of each of the periods presented. The pro forma consolidated financial statements have been prepared by AmeriVest management based upon the historical financial statements of AmeriVest, the Pro Forma (Previously Reported) financial information, and the historical real estate operating revenues and expenses of the Acquired Buildings. These pro forma statements may not be indicative of the results that actually would have occurred if the combination had been in effect on the dates indicated or which may be obtained in the future. The pro forma financial statements should be read in conjunction with the historical financial statements and notes thereto of the Acquired Buildings contained elsewhere in this document, the historical financial statements of AmeriVest for the periods ended June 30, 1998 and December 31, 1997 included in AmeriVest's Form 10-QSB and Form 10-KSB filed for each of those periods, respectively, and the Form 8-K filed by AmeriVest as of July 13, 1998. F-5
AMERIVEST PROPERTIES INC. PRO FORMA CONSOLIDATED BALANCE SHEET JUNE 30, 1998 (Unaudited) Pro Forma AmeriVest (Previously Pro Forma Pro Forma (Historical) Reported) Adjustments Combined Assets Investment in Real Estate Land $ 2,726,698 $ 3,689,118 $ 1,023,000 (a) $ 4,712,118 Building and improvements 13,192,757 19,454,637 2,702,000 (a) 22,156,637 Furniture, Fixtures and Equipment 249,675 249,675 -- 249,675 Tenant Improvements 539,490 539,490 -- 539,490 Less Accumulated depreciation and amortization (5,399,504) (5,399,504) -- (5,399,504) ------------ ------------ ------------ ------------ Net Investment in Real Estate 11,309,116 18,533,416 3,725,000 22,258,416 Cash and cash equivalents 209,874 209,874 302,000 (c) 511,874 Tenant accounts receivable 33,811 33,811 -- 33,811 Deferred Financing Costs, Net 101,347 176,894 -- 176,894 Prepaid Expenses and Other Assets 617,150 829,615 (200,000) (d) 629,615 ------------ ------------ ------------ ------------ Total Assets $ 12,271,298 $ 19,783,610 $ 3,827,000 $ 23,610,610 ============ ============ ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Mortgage loans and notes payable $ 8,393,704 $ 14,833,634 $ 4,127,000 (b) $ 18,960,634 Accounts payable and accrued expenses 74,473 74,473 -- 74,473 Accrued interest 56,219 56,219 -- 56,219 Accrued real estate taxes 188,099 260,981 -- 260,981 Prepaid rents and security deposits 89,913 89,913 -- 89,913 Dividends payable 161,783 161,783 -- 161,783 ------------ ------------ ------------ ------------ Total Liabilities 8,964,191 15,477,003 4,127,000 19,604,003 ------------ ------------ ------------ ------------ STOCKHOLDERS' EQUITY Common stock 1,445 1,645 -- 1,645 Capital in excess of par value 4,540,938 5,540,238 -- 5,540,238 Distributions in excess of accumulated earnings (1,235,276) (1,235,276) (300,000) (e) (1,535,276) ------------ ------------ ------------ ------------ Total Stockholders' Equity 3,307,107 4,306,607 (300,000) 4,006,607 ------------ ------------ ------------ ------------ Total Liabilities and Stockholders' Equity $ 12,271,298 $ 19,783,610 $ 3,827,000 $ 23,610,610 ============ ============ ============ ============ See notes to the pro forma consolidated financial statements. F-6
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS SIX MONTHS ENDED JUNE 30, 1998 (Unaudited) Pro Forma AmeriVest (Previously Acquired Pro Forma Pro Forma (Historical) Reported) Buildings Adjustments Combined REAL ESTATE OPERATING REVENUE Rental revenue Commercial properties $ 661,001 $ 1,395,577 $ 427,727 $ -- $ 1,823,304 Storage properties 721,138 721,138 -- -- 721,138 ----------- ----------- ----------- ----------- ----------- 1,382,139 2,116,715 427,727 -- 2,544,442 ----------- ----------- ----------- ----------- ----------- REAL ESTATE OPERATING EXPENSES Property operating expenses Operating expenses 302,091 551,780 157,782 -- 709,562 Real estate taxes 149,603 228,131 38,678 -- 266,809 Management fees 75,491 112,219 18,000 -- 130,219 General and administrative 197,309 211,853 546 -- 212,399 Interest 356,527 583,527 -- 87,000 (f) 670,527 Depreciation and amortization 294,755 414,112 -- 52,600 (g) 466,712 ----------- ----------- ----------- ----------- ----------- 1,375,776 2,101,622 215,006 139,600 2,456,228 ----------- ----------- ----------- ----------- ----------- OTHER INCOME Interest Income 1,742 1,742 -- -- 1,742 ----------- ----------- ----------- ----------- ----------- NET INCOME $ 8,105 $ 16,835 $ 212,721 $ (139,600) $ 89,956 =========== =========== =========== =========== =========== NET INCOME PER COMMON SHARE $ 0.05 =========== NET INCOME PER COMMON SHARE ASSUMING DILUTION $ 0.05 =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 1,645,270 =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING ASSUMING DILUTION 1,650,270 =========== See notes to the pro forma consolidated financial statements. F-7
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1997 (Unaudited) AmeriVest Pro Forma Acquired Pro Forma Pro Forma (Historical) (Previously Reported) Buildings Adjustments Combined REAL ESTATE OPERATING REVENUE Rental revenue Commercial properties $ 1,132,849 $ 2,586,385 $ 845,288 $ -- $ 3,431,673 Storage properties 1,349,333 1,349,333 -- 1,349,333 ----------- ----------- ----------- ----------- ----------- 2,482,182 3,935,718 845,288 -- 4,781,006 ----------- ----------- ----------- ----------- ----------- REAL ESTATE OPERATING EXPENSES Property operating expenses Operating expenses 559,304 1,035,362 315,616 -- 1,350,978 Real estate taxes 282,860 439,913 77,356 -- 517,269 Management fees 141,136 213,813 36,000 -- 249,813 General and administrative 400,376 426,263 1,779 -- 428,042 Interest 685,429 1,143,129 -- 209,000 (f) 1,352,129 Depreciation and amortization 570,307 809,021 -- 105,000 (g) 914,021 ----------- ----------- ----------- ----------- ----------- 2,639,412 4,067,501 430,751 314,000 4,812,252 ----------- ----------- ----------- ----------- ----------- OTHER INCOME Interest Income 36,778 36,778 -- -- 36,778 ----------- ----------- ----------- ----------- ----------- NET (LOSS) INCOME $ (120,452) $ (95,005) $ 414,537 $ (314,000) $ 5,532 =========== =========== =========== =========== =========== NET INCOME PER COMMON SHARE $ 0.003 =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 1,604,470 =========== See notes to the pro forma consolidated financial statements. F-8
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited pro forma financial statements are presented to reflect the acquisition of the four Acquired Buildings by AmeriVest's wholly owned subsidiary, AmeriVest Buildings. NOTE 2 - PRO FORMA ADJUSTMENTS The unaudited pro forma financial statements reflect the following pro forma adjustments: (a) Purchase price of the four Acquired Buildings by AmeriVest Buildings. (b) Increase in mortgage loans and notes payable related to the Acquired Buildings by AmeriVest Buildings consisting of the assumption of $1.672 million existing debt on the Acquired Buildings (interest at 9%), and refinancing of debt on properties other than those acquired, owned by other subsidiaries of AmeriVest. (c) Net cash available after refinancing of existing debt and properties owned by other subsidiaries of AmeriVest. (d) Reduction in deposit previously paid on Acquired Buildings. (e) Prepayment penalty on refinancing of existing debt on properties owned by other subsidiaries of AmeriVest. (f) Additional interest expense related to the assumption of existing debt on the Acquired Buildings by AmeriVest Buildings, and additional interest expense due to refinancing the existing debt on properties owned by other subsidiaries of AmeriVest. (g) Additional depreciation expense on the four Acquired Buildings. NOTES 3 - INCOME PER SHARE Pro forma income per common share for the six months ended June 30, 1998 and the year ended December 31, 1997 is computed based on the weighted average number of common shares outstanding during the periods, assuming that 207,200 shares issued in conjunction with the acquisition of the eleven buildings on July 13, 1998 were issued at the beginning of the periods. F-9 SIGNATURE 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 hereunto duly authorized. Date: October 30, 1998 AMERIVEST PROPERTIES INC. By: /s/ James F. Etter -------------------------------- James F. Etter President -----END PRIVACY-ENHANCED MESSAGE-----