-----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, UnYCS7JD72IHjBeCPXX8yrx2tazg0MTHxyfilD1kyz6CFM4C54aZNcy8FPg7wRsF wKuxadSRxx/VvuJQ1bEUaA== /in/edgar/work/0001050502-00-001254/0001050502-00-001254.txt : 20001114 0001050502-00-001254.hdr.sgml : 20001114 ACCESSION NUMBER: 0001050502-00-001254 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000825 ITEM INFORMATION: FILED AS OF DATE: 20001113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERIVEST PROPERTIES INC CENTRAL INDEX KEY: 0000927102 STANDARD INDUSTRIAL CLASSIFICATION: [6798 ] IRS NUMBER: 841240264 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 001-14462 FILM NUMBER: 759868 BUSINESS ADDRESS: STREET 1: 1800 GLENARM PLACE STREET 2: SUITE 500 CITY: DENVER, STATE: CO ZIP: 80202 BUSINESS PHONE: 3032971800 MAIL ADDRESS: STREET 1: 7100 GRANDVIEW AVE STREET 2: SUITE 1 CITY: ARVADA STATE: CO ZIP: 80002 8-K/A 1 0001.txt 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 25, 2000 AmeriVest Properties Inc. (Exact name of registrant as specified in its charter) Maryland 1-14462 84-1240264 -------- ------- ---------- (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 1800 Glenarm Place, Suite 500, Denver, Colorado 80202 ----------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (303) 297-1800 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (a) Financial Statements of Real Estate Properties Acquired: Report of Independent Public Accountants F-1 Statements of Revenue and Certain Expenses - year ended December 31, 1999 and six months ended June 30, 2000 (unaudited) F-2 Notes to Statements of Revenue and Certain Expenses F-3 (b) Unaudited Pro Forma Financial Information: Pro Forma Financial Information F-4 Unaudited Pro Forma Consolidated Balance Sheet as of June 30, 2000 F-5 Unaudited Pro Forma Consolidated Statement of Operations: Six Months ended June 30, 2000 F-6 Year ended December 31, 1999 F-7 Notes to Unaudited Pro Forma Consolidated Financial Statements F-8 (c) Statement of Estimated Taxable Operating Results and Cash to be Made Available by Operations (unaudited) F-9 Note to Statement of Estimated Taxable Operating Results and Cash to be Made Available by Operations (unaudited) F-10 (a) Financial Statements of Real Estate Properties Acquired. REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Management of The Writer Buildings: We have audited the statement of revenue and certain expenses of the Writer Buildings (see Note 1) for the year ended December 31, 1999. This financial statement is the responsibility of the Writer Buildings' management. Our responsibility is to express an opinion on this financial statement based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States. 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 statement of revenue and certain expenses 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 Writer Buildings' revenue and expenses and/or financial position. In our opinion, the financial statement referred to above presents fairly, in all material respects, the revenue and certain expenses of the Writer Buildings for the year ended December 31, 1999, in conformity with accounting principles generally accepted in the United States. /s/ Arthur Andersen LLP ----------------------- Arthur Andersen LLP Denver, Colorado, August 31, 2000. F-1 THE WRITER BUILDINGS STATEMENTS OF REVENUE AND CERTAIN EXPENSES For the Year For the Six Ended Months Ended December 31, June 30, 1999 2000 ---- ---- (unaudited) REVENUE: Rental revenue (Note 2) $1,451,297 $ 748,796 Other revenue 60,420 31,659 ---------- ---------- Total revenue 1,511,717 780,455 ---------- ---------- CERTAIN EXPENSES: Repairs and maintenance 38,367 32,288 Utilities 178,594 98,292 Property taxes 103,115 51,824 Property management fees 80,485 43,111 Operating services 289,997 186,524 ---------- ---------- Total certain expenses 690,558 412,039 ---------- ---------- EXCESS REVENUE OVER CERTAIN EXPENSES $ 821,159 $ 368,416 ========== ========== The accompanying notes are an integral part of these financial statements. F-2 THE WRITER BUILDINGS NOTES TO STATEMENTS OF REVENUE AND CERTAIN EXPENSES DECEMBER 31, 1999 (1) BASIS OF PRESENTATION The statements of revenue and certain expenses reflect the operations of the Writer Buildings (the "Property"). The Property consists of three office buildings located at 1777, 1780 and 1805 South Bellaire Street in Denver, Colorado. The Property was acquired by AmeriVest Properties Inc. and subsidiaries (the "Company") from an unrelated third party on August 31, 2000. The Property has an aggregate net rentable area of approximately 140,500 square feet (91% leased as of December 31, 1999). These statements of revenue and certain expenses are prepared pursuant to the rules and regulations of the Securities and Exchange Commission. The accounting records of the Property are maintained on the accrual basis. The accompanying financial statements exclude certain expenses such as interest, depreciation and amortization, professional fees, and other costs not directly related to the future operations of the Property. 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 revenue and expenses during the reporting period. The ultimate results could differ from those estimates. In the opinion of management, the unaudited information as of June 30, 2000 included herein contains all the adjustments necessary, which are of a normal recurring nature, to present fairly the revenue and certain expenses for the six months ended June 30, 2000. Results of interim periods are not necessarily indicative of results to be expected for the year. Management is not aware of any material factors that would cause the information included herein to not be indicative of future operating results. (2) OPERATING LEASES Rental revenue presented for the year ended December 31, 1999, is recorded in accordance with generally accepted accounting principles. The Property is leased to tenants under operating leases with expiration dates extending to the year 2007. Future minimum rentals under noncancellable operating leases, excluding tenant reimbursements of operating expenses as of December 31, 1999, are as follows: Year ending December 31, - 2000 $1,161,413 2001 780,635 2002 300,202 2003 73,175 2004 18,860 Thereafter 42,435 ---------- $2,376,720 ========== F-3 (b) Pro Forma Financial Information. AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA FINANCIAL INFORMATION The accompanying unaudited pro forma consolidated balance sheet presents the historical financial information of AmeriVest Properties Inc. and Subsidiaries (AmeriVest) as of June 30, 2000, as adjusted for the sale of the self-storage facilities and the acquisition of the Writer Buildings, both transactions being consummated in August 2000. The accompanying unaudited pro forma consolidated statements of operations for the six months ended June 30, 2000 and the year ended December 31, 1999 combine the historical financial information of AmeriVest with the historical real estate operating revenues and expenses of the Writer Buildings and subtract the historical real estate operating revenues and expenses of AmeriVest's self-storage facilities, as if the acquisition and sale had occurred at the beginning of the periods presented. The unaudited pro forma consolidated financial statements have been prepared by AmeriVest management based upon the historical financial statements of AmeriVest and the Writer 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 of AmeriVest for the year ended December 31, 1999 included in AmeriVest's Form 10-KSB filed for the year ended December 31, 1999, and for the three and six months ended June 30, 2000 included in AmeriVest's Form 10-QSB for the quarter ended June 30, 2000. F-4
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA CONSOLIDATED BALANCE SHEET JUNE 30, 2000 (Unaudited) Sale of Acquisition AmeriVest Self Storage of Writer Pro Forma (Historical) Facilities Buildings Combined ------------ ---------- --------- -------- ASSETS Investment in Real Estate Land $ 7,098,379 $ (1,720,080) $ 3,464,362(b) $ 8,842,661 Building and improvements 32,575,927 (7,535,242) 6,211,256(b) 31,251,941 Furniture, fixtures and equipment 322,312 (251,837) -- 70,475 Tenant improvements 718,557 (375,447) 35,189(b) 378,299 Less accumulated depreciation and amortization (7,165,288) 4,487,056 -- (2,678,232) ------------ ------------ ------------ ------------ Net Investment in Real Estate 33,549,887 (5,395,550) 9,710,807 37,865,144 Cash and cash equivalents 491,374 1,818,161 (2,533,389)(a) (223,854) Tenant accounts receivable 40,153 (31,331) -- 8,822 Straight-line rents receivable 126,279 -- -- 126,279 Deferred financing costs, net 570,615 (220,086) 89,120(b) 439,649 Tenant leasing commissions 460,966 -- 14,211(b) 475,177 Prepaid expenses and other assets 628,530 (67,238) 2,662(b) 563,954 ------------ ------------ ------------ ------------ Total Assets $ 35,867,804 $ (3,896,044) $ 7,283,411 $ 39,255,171 ============ ============ ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Mortgage loans $ 27,790,393 $ (6,309,246) $ 7,120,441(a) $ 28,601,588 Accounts payable and accrued expenses 496,516 53,936 -- 550,452 Accrued interest 144,987 -- -- 144,987 Accrued real estate taxes 509,381 (104,757) 69,099(b) 473,723 Prepaid rents and security deposits 709,691 (92,816) 93,871(b) 710,746 Dividends payable 267,462 -- -- 267,462 ------------ ------------ ------------ ------------ Total Liabilities 29,918,430 (6,452,883) 7,283,411 30,748,958 ------------ ------------ ------------ ------------ STOCKHOLDERS' EQUITY Common stock 2,229 -- -- 2,229 Capital in excess of par value 8,179,723 -- -- 8,179,723 Distributions in excess of Accumulated earnings (2,232,578) 2,556,839 -- 324,261 ------------ ------------ ------------ ------------ Total Stockholders' Equity 5,949,374 2,556,839 -- 8,506,213 ------------ ------------ ------------ ------------ $ 35,867,804 $ (3,896,044) $ 7,283,411 $ 39,255,171 ============ ============ ============ ============ See notes to the pro forma consolidated financial statements. F-5
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS SIX MONTHS ENDED JUNE 30, 2000 (Unaudited) Historical ---------------------------------------- Self Storage Writer Pro Forma Pro Forma AmeriVest Facilities Buildings Adjustments Combined --------- ---------- --------- ----------- -------- REAL ESTATE OPERATING REVENUE Rental Revenue Commercial properties $ 2,713,186 $ (24,887) $ 780,455 $ -- $ 3,468,754 Storage properties 644,327 (644,327) -- -- -- ----------- ----------- ----------- ----------- ----------- 3,357,513 (669,214) 780,455 -- 3,468,754 ----------- ----------- ----------- ----------- ----------- REAL ESTATE OPERATING EXPENSES Property Operating Expenses Operating expenses 890,698 (137,365) 317,104 -- 1,070,437 Real estate taxes 330,251 (80,888) 51,824 -- 301,187 Management fees 159,967 (33,496) 43,111 (4,088)(e) 165,494 General and administrative 243,549 (15,755) -- -- 227,794 Interest 954,760 (251,647) -- 330,000(d) 1,033,113 Depreciation and amortization 569,657 (186,552) -- 124,220(c) 507,325 ----------- ----------- ----------- ----------- ----------- 3,148,882 (705,703) 412,039 450,132 3,305,350 ----------- ----------- ----------- ----------- ----------- OTHER INCOME Interest income 16,891 (206) -- -- 16,685 ----------- ----------- ----------- ----------- ----------- NET INCOME $ 225,522 $ 36,283 $ 368,416 $ (450,132) $ 180,089 =========== =========== =========== =========== =========== NET INCOME PER COMMON SHARE $ 0.10 $ 0.08 =========== =========== NET INCOME PER COMMON SHARE - ASSUMING DILUTION $ 0.10 $ 0.08 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 2,228,850 2,228,850 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES ASSUMING DILUTION 2,229,830 2,229,830 =========== =========== See notes to the pro forma consolidated financial statements. F-6
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1999 (Unaudited) Historical ---------------------------------------- Self Storage Writer Pro Forma Pro Forma AmeriVest Facilities Buildings Adjustments Combined --------- ---------- --------- ----------- -------- REAL ESTATE OPERATING REVENUE Rental Revenue Commercial properties $ 4,561,479 $ (63,217) $ 1,511,717 $ -- $ 6,009,979 Storage properties 1,415,278 (1,415,278) -- -- -- ----------- ----------- ----------- ----------- ----------- 5,976,757 (1,478,495) 1,511,717 -- 6,009,979 ----------- ----------- ----------- ----------- ----------- REAL ESTATE OPERATING EXPENSES Property Operating Expenses Operating expenses 1,636,305 (282,805) 506,958 -- 1,860,458 Real estate taxes 596,790 (161,776) 103,115 -- 538,129 Management fees 124,111 (73,876) 80,485 (4,899)(e) 125,821 General and administrative 657,349 (34,469) -- -- 622,880 Interest 1,647,225 (505,657) -- 660,000(d) 1,801,568 Depreciation and amortization 1,082,447 (371,858) -- 248,440(c) 959,029 ----------- ----------- ----------- ----------- ----------- 5,744,227 (1,430,441) 690,558 903,541 5,907,885 ----------- ----------- ----------- ----------- ----------- OTHER INCOME Interest income 15,506 (416) -- -- 15,090 Gain on sale of real estate 720,712 -- -- -- 720,712 ----------- ----------- ----------- ----------- ----------- 736,218 (416) -- -- 735,802 ----------- ----------- ----------- ----------- ----------- NET INCOME $ 968,748 $ (48,470) $ 821,159 $ (903,541) $ 837,896 =========== =========== =========== =========== =========== NET INCOME PER COMMON SHARE $ 0.51 $ 0.45 =========== =========== NET INCOME PER COMMON SHARE - ASSUMING DILUTION $ 0.51 $ 0.45 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 1,881,075 1,881,075 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES ASSUMING DILUTION 1,882,232 1,882,232 =========== =========== See notes to the pro forma consolidated financial statements. F-7
AMERIVEST PROPERTIES INC. AND SUBSIDIARIES NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited pro forma consolidated financial statements are presented to reflect the sale of the self-storage facilities and the acquisition of the Writer Buildings by AmeriVest. The accompanying pro forma consolidated balance sheet as of June 30, 2000 has been prepared to give effect to the sale of the self-storage facilities and the acquisition of the Writer Buildings as if each of the sale and acquisition occurred on June 30, 2000. The accompanying pro forma consolidated statements of operations combine the historical operations of AmeriVest for the six months ended June 30, 2000 and the year ended December 31, 1999 with the historical real estate operating revenues and expenses of the Writer Buildings for the six months ended June 30, 2000 and the year ended December 31, 1999, respectfully, minus the historical real estate operating revenues and expenses of the self-storage facilities for the same periods, and are presented as if the acquisition had occurred at the beginning of each of the periods presented. NOTE 2 - PRO FORMA ADJUSTMENTS The unaudited pro forma consolidated financial statements reflect the following pro forma adjustments: a) The purchase price of the Writer Buildings is summarized as follows: Cash paid $2,533,389 New mortgage loans 7,120,441 ---------- Total purchase price $9,653,830 ========== The new mortgage loans bear interest based on LIBOR (assumed 9% for proforma purposes). b) The purchase price of the Writer Buildings was allocated to the assets and liabilities based on estimated fair value. c) Depreciation expense on the Writer Buildings based on an estimated useful life of 25 years. d) Interest expense to be recognized related to mortgage debt procured upon the acquisition of the Writer Buildings. e) Adjustment to management fees pursuant to Sheridan Realty Advisors agreement: Six Months Ended Year Ended June 30, 2000 December 31, 1999 ------------- ----------------- Elimination of historical management fees $(43,111) $(80,485) Management fees per Sheridan Realty Advisors agreement 39,023 75,586 -------- -------- Pro forma adjustment $ (4,088) $ (4,899) ======== ======== NOTE 3 - INCOME PER SHARE Pro forma income per common share for the months ended June 30, 2000 and the year ended December 31, 1999 is computed based on the weighted average number of common shares outstanding during the periods. F-8 (c) Statement of Estimated Taxable Operating Results and Cash to be Made Available by Operations. AMERIVEST PROPERTIES INC. AND SUBSIDIARIES STATEMENT OF ESTIMATED TAXABLE OPERATING RESULTS AND CASH TO BE MADE AVAILABLE BY OPERATIONS FOR THE TWELVE MONTH PERIOD ENDED DECEMBER 31, 1999 (Unaudited) The following represents an estimate of the taxable operating results and cash to be made available by operations expected to be generated by the Company (including the operations of the Writer Buildings) based upon the pro forma consolidated statements of operations for the year ended December 31, 1999. These estimated results do not purport to represent results of operations for these properties in the future and were prepared on the basis described in the accompanying notes which should be read in conjunction herewith. Revenue $6,009,979 Expenses: Operating expenses 1,860,458 Real estate taxes 538,129 Management fees 125,821 General and administrative 622,880 Interest 1,801,568 Depreciation and amortization 869,589 ---------- Total expenses 5,818,445 ---------- Estimated Taxable Operating Gain 191,534 Add back depreciation and amortization 869,589 ---------- Estimated Cash to be Made Available by Operations $1,061,123 ========== F-9 AMERIVEST PROPERTIES INC. AND SUBSIDIARIES NOTE TO STATEMENT OF ESTIMATED TAXABLE OPERATING RESULTS AND CASH TO BE MADE AVAILABLE BY OPERATIONS (Unaudited) NOTE 1 - BASIS OF PRESENTATION Depreciation has been estimated based upon an allocation of the purchase price of the Writer Buildings to land (35.8%) and buildings (64.2%) and assuming (for tax purposes) a 39-year useful life applied on a straight-line method. No income taxes have been provided because the Company is organized and operates in such a manner so as to qualify as a Real Estate Investment Trust ("REIT") under the provisions of the Internal Revenue Code (the "Code"). Accordingly, the Company generally will not pay Federal income taxes provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code. F-10 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: November 10, 2000 AMERIVEST PROPERTIES INC. By: /s/ D. Scott Ikenberry -------------------------- D. Scott Ikenberry Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----