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U.S. Securities and Exchange Commission
Washington, D.C. 20549
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Form 8-K/A
Amendment No. 3
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported): August 26, 1997
Roberts Realty Investors, Inc.
(Exact name of Registrant as specified in charter)
Georgia 0-28048 56-2122873
(State or other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification Number)
8010 Roswell Road, Suite 120, Atlanta, Georgia 30350
(Address of principal executive offices) (Zip Code)
(770) 394-6000
(Registrant's Telephone Number, including Area Code)
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FORM 8-K/A
AMENDMENT NO. 3
ITEM 7 - FINANCIAL STATEMENTS AND EXHIBITS
(a) Pro Forma Financial Statements
(i) Pro forma condensed consolidated balance sheet as of September 30,
1997 (unaudited).
(ii) Pro forma consolidated statements of operations for the year ended
December 31, 1996 (unaudited) and for the nine months ended September
30, 1997 (unaudited).
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ROBERTS REALTY INVESTORS, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1997
(IN THOUSANDS)
(UNAUDITED)
This unaudited pro forma condensed consolidated balance sheet is presented with
the August 26, 1997 sale of the Autumn Ridge community already reflected in the
Company's historical Balance Sheet as of September 30, 1997. In management's
opinion, all adjustments necessary to reflect the effect of this transaction
have been made. This unaudited pro forma condensed consolidated balance sheet
is not necessarily indicative of what the actual financial position would have
been at September 30, 1997, nor does it purport to represent the future
financial position of the Company.
<TABLE>
<CAPTION>
ADJUSTMENTS
FOR SALE OF
HISTORICAL AUTUMN RIDGE (A) PRO FORMA
<S> <C> <C> <C>
ASSETS
NET REAL ESTATE ASSETS $ 106,513 $ 106,513
CASH AND CASH EQUIVALENTS 11,041 $ 5 (B) 11,046
RESTRICTED CASH 667 667
OTHER ASSETS - NET 1,067 (8)(C) 1,059
---------- ------------ ---------
$ 119,288 $ (3) $ 119,285
========== ============ =========
LIABILITIES AND
SHAREHOLDERS' EQUITY
LIABILITIES:
Mortgage notes payable 68,179 68,179
Other liabilities 4,655 (3)(D) 4,652
---------- ------------ ---------
72,834 (3) 72,831
MINORITY INTEREST 20,672 20,672
SHAREHOLDERS' EQUITY:
Common stock 42 42
Additional paid-in capital 29,396 29,396
Accumulated deficit (3,656) (3,656)
---------- ---------
25,782 25,782
---------- ------------ ---------
$ 119,288 $ (3) $ 119,285
========== ============ =========
</TABLE>
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Notes to pro forma condensed consolidated balance sheet (unaudited):
(A) Represents the adjustments necessary to reflect the effects of the
Company's sale of the Autumn Ridge community.
(B) Reflects the increase in cash from the collection of $8,000 of
receivables less the payment of $3,000 of accounts payable which relate
to the sale of the Autumn Ridge community.
(C) Reflects the collection of certain receivables related to the sale of the
Autumn Ridge community.
(D) Reflects the payment of accounts payable related to the sale of the Autumn
Ridge community.
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ROBERTS REALTY INVESTORS, INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 1997
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
The accompanying pro forma consolidated statement of operations is presented as
if the Company's sale of the Autumn Ridge community and the purchase of Roberts
Properties Management L.L.C. had occurred as of January 1, 1997. In
management's opinion, all adjustments necessary to reflect the effects of these
transactions have been made. This unaudited pro forma consolidated statement of
operations is not necessarily indicative of what the actual results of
operations would have been had these transactions occurred on January 1, 1997,
nor does it purport to represent the results of operations for future periods.
<TABLE>
<CAPTION>
ROBERTS
PROPERTIES ADJUSTMENTS
MANAGEMENT FOR SALE OF
L.L.C. AUTUMN
HISTORICAL HISTORICAL (A) ADJUSTMENTS RIDGE (B) PRO FORMA
<S> <C> <C> <C> <C> <C>
OPERATING REVENUES: $ 13,171 $ 211 $ (211)(C) $ (1,088) $ 12,083
----------- ----------- ------- -------- --------
OPERATING EXPENSES:
Personnel 1,281 (143) 1,138
Utilities 872 (124) 748
Repairs, maintenance, and landscaping 799 (112) 687
Real estate taxes 1,093 (62) 1,031
Management fees to related party 211 (191)(D) (20)
Marketing, insurance & other 605 (50) 555
General & administrative expenses 1,149 183 1,332
Depreciation of real estate assets 4,344 (363) 3,981
----------- ----------- ------- -------- --------
Total operating expenses 10,354 183 (191) (874) 9,472
----------- ----------- ------- -------- --------
INCOME FROM OPERATIONS 2,817 28 (20) (214) 2,611
----------- ----------- ------- --------- --------
OTHER INCOME (EXPENSES):
Interest income 263 (32) 231
Interest expense (3,570) 230 (3,340)
Gain on sale of asset 1,792 (1,792)
Loss on disposal of assets (124) 17 (107)
Amortization of deferred financing costs (90) 6 (84)
Other amortization expense (26) (7) 7 (E) (26)
Acquisition of Roberts Properties
Management, L.L.C (5,900) 5,900 (F)
----------- ----------- ------- --------- --------
Total other income (expenses) (7,655) (7) 5,907 (1,571) (3,326)
----------- ----------- ------- --------- --------
INCOME (LOSS) BEFORE MINORITY
INTEREST AND EXTRAORDINARY ITEM (4,838) 21 5,887 (1,785) (715)
MINORITY INTEREST 2,085 (1,766)(G) 319
----------- ----------- ------- --------- --------
INCOME (LOSS) BEFORE
EXTRAORDINARY ITEM $ (2,753) $ 21 $ 4,121 $ (1,785) $ (396)
=========== =========== ======= ========= ========
PER SHARE DATA:
Income (loss) before extraordinary item $ (0.66) $ (0.09)
=========== ========
Weighted average common shares assumed
to be outstanding 4,186,330 4,186,330
=========== =========
</TABLE>
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(A) Reflects the historical statement of operations for the three months ended
March 31, 1997, the period prior to the acquisition of Roberts Properties
Management, L.L.C. ("Roberts Management").
(B) On August 26, 1997, the Autumn Ridge community was sold and all of its
operating revenues and expenses have been eliminated from the pro forma
for the period presented. The sale resulted in a gain of $1,792,000.
(C) Reflects the elimination of management fee income as a result of the
merger of Roberts Management into Roberts Properties Residential, L.P.
(D) Reflects the elimination of management fees paid to Roberts Management by
Roberts Properties Residential, L.P. The fees related to the Autumn Ridge
community are eliminated in adjustment (B).
(E) Reflects the elimination of amortization expense resulting from the
write-off of Roberts Management's unamortized management contracts.
(F) Reflects the elimination of the nonrecurring expense associated with the
purchase of Roberts Management.
(G) Reflects the adjustment necessary to arrive at the 44.6% pro forma
minority interest that would exist had the purchase of Roberts Management
occurred on January 1, 1997.
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ROBERTS REALTY INVESTORS, INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1996
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
The accompanying pro forma consolidated statement of operations is presented as
if the Company's acquisitions of (1) Roberts Properties Bentley Place, L.P.
effective March 1, 1996 for $7,235,000, (2) The Crestmark Club, L.P. effective
June 1, 1996 for $19,025,500, (3) Roberts Properties Management, L.L.C.
effective April 1, 1997 for $5,900,000, and (4) the sale of the Autumn Ridge
community on August 26, 1997 for $10,601,000 had occurred as of January 1,
1996. The acquisitions of Roberts Properties Bentley Place, L.P. and The
Crestmark Club, L.P. have been accounted for using the purchase method of
accounting. The Company acquired Roberts Properties Management, L.L.C. through
a merger. In management's opinion, all adjustments necessary to reflect the
effects of these transactions have been made. This unaudited pro forma
consolidated statement of operations is not necessarily indicative of what the
actual results of operations would have been had this transaction occurred on
January 1, 1996, nor does it purport to represent the results of operations for
future periods.
<TABLE>
<CAPTION>
ROBERTS
PROPERTIES
MANAGEMENT ADJUSTMENTS FOR
L.L.C. SALE OF AUTUMN
HISTORICAL ACQUISITIONS ADJUSTMENTS FOR RIDGE PRO
HISTORICAL (A) ADJUSTMENTS (B) ACQUISITIONS (C) FORMA
<S> <C> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES: $ 15,197 $ 874 $ (874)(D)(E) $ 1,118 $ (1,470) $ 14,845
---------- ------- ------ ------- -------- ---------
OPERATING EXPENSES:
Personnel 1,365 106 (168) 1,303
Utilities 932 75 (186) 821
Repairs, maintenance, and landscaping 956 65 (86) 935
Real estate taxes 1,149 106 (77) 1,178
Management fees to related party 760 (760)(D)
Marketing, insurance & other 689 64 (110) 643
General & administrative expenses 926 491 1,417
Depreciation of real estate assets 4,974 2 (2)(F) 286 167(G) (579) 4,848
---------- ------ ------ ------- --- -------- ---------
Total operating expenses 11,751 493 (762) 702 167 (1,206) 11,145
---------- ------ ----- ------- --- -------- ---------
INCOME FROM OPERATIONS 3,446 381 (112) 416 (167) (264) 3,700
---------- ------ ----- ------- --- -------- ---------
OTHER INCOME (EXPENSES):
Interest income 353 3 5 (8) 353
Interest expenses (3,724) (365) (17)(H) 269 (3,837)
Amortization of deferred financing costs (141) (16) 14 (I) 6 (137)
Other amortization expense (67) (19) 19 (J) (67)
---------- ------ ----- ------- --- -------- ---------
Total other income (expenses) (3,579) (16) 19 (376) (3) 267 (3,688)
---------- ------ ----- ------- --- -------- ---------
INCOME (LOSS) BEFORE MINORITY
INTEREST & EXTRAORDINARY ITEM (133) 365 (93) 40 (170) 3 12
MINORITY INTEREST 52 (26)(K) (31) (5)
---------- ------ ----- ------- --- --------- ---------
INCOME (LOSS) BEFORE
EXTRAORDINARY ITEM (81) 365 (93) 40 (196) (28) 7
========== ====== ===== ======= === ========= =========
PER SHARE DATA:
Income (loss) before extraordinary item $ (0.02) $ (0.00)
========== =========
Weighted average common shares
assumed to be outstanding(L) 3,799,567 4,154,659
========== =========
</TABLE>
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Notes to pro forma consolidated statement of operations (unaudited):
(A) Reflects the historical statement of operations for the year ended
December 31, 1996 of Roberts Properties Management, L.L.C. (Roberts
Management).
(B) Reflects the Roberts Properties Bentley Place, L.P. unaudited historical
statement of operations for the two months ended February 29, 1996, and
The Crestmark Club, L.P. unaudited historical statement of operations for
the five months ended May 31, 1996, prior to their acquisition by the
Company excluding management fees paid to Roberts Management.
(C) On August 26, 1997, the Autumn Ridge community was sold and all of its
operating revenues and expenses have been eliminated from the pro forma
for the period presented. The sale resulted in a gain of $1,792,000 and
extraordinary charges of $326,000 related to debt prepayment for a net
gain of $1,466,000 which is not reflected in the pro forma statement of
operations.
(D) Reflects the elimination of $760,000 of management fees paid to Roberts
Management by Roberts Properties Residential, L.P. (the Operating
Partnership).
(E) Reflects the elimination of $114,000 of management fees paid to Roberts
Management on certain properties prior to their inclusion in the Operating
Partnership.
(F) Reflects the elimination of depreciation expense on certain assets held by
Roberts Management deemed to have no future value ($2,000).
(G) Reflects an increase in depreciation as a result of the purchase of the
Bentley Place Community ($12,000), and the Crestmark Community ($155,000).
(H) Reflects the reduction in interest expense ($1,000) associated with the
payoff of the note payable at the closing of the Bentley Place
acquisition. Reflects an increase in interest expense ($73,000) for the
$4,100,000 loan that was placed on the Bentley Place Community. The loan
has a fixed interest rate of 7.10% for a 10-year term with monthly
payments of principal and interest based on a 30-year amortization
schedule. Reflects a decrease in interest expense due to the payment of
the Crestmark land loans at the closing of the acquisition of the
Crestmark Community ($55,000).
(I) Reflects a reduction in amortization expense ($1,000) for the write-off of
intangible assets as a result of the Bentley Place acquisition. Reflects
an increase in amortization expense ($2,000) for the estimated loan costs
of $73,000 associated with the loan to be secured by the Bentley Place
Community. Reflects the reduction in amortization expense ($15,000)
resulting from the write-off of The Crestmark Club, L.P.'s unamortized
loan costs.
(J) Reflects the elimination of amortization expense resulting from the
cancellation and write-off of Roberts Management's unamortized management
contracts.
(K) Represents the adjustment to reflect the 45.0% minority interest that
would result if the acquisition of Roberts Management, the Bentley Place
Community and the Crestmark Community had occurred as of January 1, 1996.
(L) Pro forma weighted average shares outstanding reflects historical weighted
average shares outstanding for the year ended December 31, 1996 adjusted
to give effect to (i) 744,940 shares of common stock issued in connection
with the acquisition of Bentley Place and (ii) 699,175 shares issued in
the offering of common stock in March and May as if such shares had been
issued on January 1, 1996. Earnings per share is unaffected by partners
who receive units in the Operating Partnership instead of shares of common
stock of the Company because unitholders and shareholders effectively
share equally in the income or loss of the Operating Partnership.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be filed on its behalf by the
undersigned hereunto duly authorized.
ROBERTS REALTY INVESTORS, INC.
Date: November 24, 1997 By: /s/ Charles S. Roberts
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Charles S. Roberts
Chairman of the Board, Chief
Executive Officer and President
