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PROSPECTUS SUPPLEMENT Filed Pursuant To Rule 424(b)(3)
(To Prospectus dated June 5, 1998) Registration No. 333-56251
5,349,113 Shares
GOLF TRUST OF AMERICA, INC.
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Common Stock
We are Golf Trust of America, Inc., a self-administered real
estate investment trust focused on owning and acquiring upscale golf courses
in a number of markets across the United States. We are offering to the
public 5,349,113 shares of our sole class of Common Stock. All of these
shares are being offered by the selling shareholders identified in the
accompanying Prospectus, or by their transferees, pledgees, donees or
successors. We will not receive any of the proceeds from the sale of these
shares by such selling shareholders.
Our Common Stock is traded on the American Stock Exchange
under the symbol "GTA". On April 16, 1999, the last reported sale price for
the Common Stock on the American Stock Exchange was $21.9375 per share.
INVESTING IN THE COMMON STOCK INVOLVES A NUMBER OF RISKS. SEE
"ADDITIONAL RISK FACTORS," BEGINNING ON PAGE S-3 OF THIS PROSPECTUS
SUPPLEMENT, AND "RISK FACTORS," BEGINNING ON PAGE 2 OF THE ACCOMPANYING
PROSPECTUS, TO READ ABOUT CERTAIN FACTORS YOU SHOULD CONSIDER BEFORE BUYING
SHARES OF COMMON STOCK.
On the date of this Prospectus Supplement, the selling
shareholders do not yet own the offered shares of Common Stock. Instead they
hold units of limited partnership interest in Golf Trust of America, L.P.,
the operating partnership through which we conduct our business (and, with
respect to 250,000 shares, they own options to acquire shares of Common
Stock). The selling shareholders have the right to redeem their operating
partnership units, or OP Units, generally beginning one year after issuance.
When an OP Unitholder presents his or her OP Units to us for redemption, we
have the right to decide whether to redeem the OP Unit for cash or exchange
it for Common Stock. This Prospectus relates to the shares of Common Stock
which we may decide to issue in exchange for OP Units.
The selling shareholders may sell their shares by means of
this Prospectus or they may decide to sell them by other means; however they
are not obligated to sell their shares at all. The selling shareholders may
sell their shares from time to time in one or more types of transactions
(which may include block transactions) on the American Stock Exchange, in the
over-the-counter market, in negotiated transactions, through put or call
option transactions relating to the shares, through short sales of shares, or
a combination of such methods of sale, at market prices prevailing at the
time of sale, or at negotiated prices. The selling shareholders may sell
their shares directly to purchasers or through agents, underwriters or
dealers. If required by law, the names of any such agents and underwriters
involved in the sale and the applicable agent's commission, dealer's purchase
price or underwriter's discount, if any, will be set forth in an accompanying
supplement to the Prospectus. The selling shareholders will pay any
applicable underwriting discounts, selling commissions and transfer taxes. We
are responsible for payment of all other expenses incident to the
registration of the shares. The selling shareholders and any broker-dealers,
agents or underwriters that participate in the distribution of the shares may
be deemed to be "underwriters" within the meaning of the Securities Act of
1933, and any commission received by them and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
PROSPECTUS SUPPLEMENT DATED APRIL 19, 1999
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TABLE OF CONTENTS
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PROSPECTUS SUPPLEMENT
Note Regarding Forward Looking Statements................................S-2
Additional Risk factors..................................................S-3
Supplemental Plan of Distribution........................................S-4
PROSPECTUS
Available Information......................................................i
Incorporation of Certain Information by Reference..........................i
The Company................................................................1
Risk Factors...............................................................2
Use of Proceeds...........................................................15
Selling Shareholders......................................................15
Federal Income Tax Considerations.........................................16
Plan of Distribution......................................................31
Description of Capital Stock..............................................33
Description of Debt Securities............................................42
Description of Warrants...................................................58
Experts...................................................................59
Legal Matters.............................................................59
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NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus Supplement and the accompanying Prospectus
(including the information incorporated in them by reference) contain
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements are those that
predict or describe future events or trends and that do not relate solely to
historical matters. You can generally identify forward-looking statements as
statements containing the words "believe," "expect," "anticipate," "intend,"
"estimate," "assume" or other similar expressions.
YOU SHOULD NOT RELY ON OUR FORWARD-LOOKING STATEMENTS BECAUSE
THE MATTERS THEY DESCRIBE ARE SUBJECT TO KNOWN (AND UNKNOWN) RISKS,
UNCERTAINTIES AND OTHER UNPREDICTABLE FACTORS, MANY OF WHICH ARE BEYOND OUR
CONTROL. Many relevant risks are described under the caption "Risk Factors"
in the accompanying Prospectus (as well as throughout our disclosure
documents), and you should consider the important factors listed there as you
read this supplement and the accompanying Prospectus.
Our actual results, performance or achievements may differ
materially from the anticipated results, performance or achievements that are
expressed or implied by our forward-looking statements. We assume no
responsibility to update our forward-looking statements.
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ADDITIONAL RISK FACTORS
INVESTING IN OUR COMMON STOCK INVOLVES A NUMBER OF RISKS. IN
ADDITION TO THE RISKS DESCRIBED UNDER "RISK FACTORS," BEGINNING ON PAGE 2 OF
THE ACCOMPANYING PROSPECTUS, PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER
THE FOLLOWING INFORMATION IN CONJUNCTION WITH THE OTHER INFORMATION
CONTAINED, OR INCORPORATED BY REFERENCE, IN THIS PROSPECTUS SUPPLEMENT AND
THE ACCOMPANYING PROSPECTUS BEFORE MAKING A DECISION TO PURCHASE SHARES OF
OUR COMMON STOCK.
MARKET CONDITIONS AND THE COST OF FINANCING NEW ACQUISITIONS MAY LIMIT OUR
GROWTH RATE
The cost of equity and debt financing for new acquisitions has
recently been increasing. The increased cost of financing, combined with
increases in the sales prices of existing golf courses results in a lower
profit margin on new acquisitions. While these market conditions continue,
we expect that we may acquire fewer golf courses. If the current market
conditions persist for an extended period of time, our current earnings
growth rates may decline. As a result, we could experience a material
adverse effect on our ability to pay distributions to our stockholders and on
the market prices of our equity securities.
RISKS ASSOCIATED WITH ENTERING NEW MARKET AREAS
Although our historical industry expertise is in the southern and
eastern portions of the United States, we have expanded our ownership of golf
courses into new market areas in recent months (I.E., the western United
States). If appropriate opportunities arise, we may make other selective
investments in markets outside of our current markets. Our entry into new
markets will require us to apply our experience to these new market areas,
but we cannot assure you that our historical expertise will be applicable to
new market areas. If we expand into new market areas in the future, we may
be exposed to risks associated with:
- a lack of market knowledge and understanding of the local economy,
which may cause us to model prospective acquisitions incorrectly;
- an inability to identify appropriate golf course acquisition
opportunities;
- an inability to obtain qualified operators for acquired golf courses;
and
- an unfamiliarity with local governmental regulations.
PORTFOLIO ACQUISITION RISKS
Our business and acquisition strategy may include the
acquisition of multiple golf courses in a single transaction in order to
reduce acquisition expenses per asset, and to enable us to enlarge our
critical mass of assets which provide operating leverage. However, portfolio
acquisitions are more complex than single-asset acquisitions, and the risk
that a portfolio acquisition will not close may be greater than in a
single-asset acquisition. In addition, our costs
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for a portfolio acquisition that does not close are generally greater than
for a single-asset acquisition that does not close. If we fail to close one
or more portfolio acquisitions, then our ability to increase our net income
will be limited and a charge to earnings for costs related to the failed
acquisition(s) may occur. In addition, a portfolio acquisition may require
us to own one or more assets which are located in geographically dispersed
markets that are geographically removed from our principal markets.
Another risk associated with portfolio acquisitions is that a
seller may require that a group of assets be purchased as a package, even
though one or more of the assets in the portfolio does not meet our
investment criteria. In such cases, we may attempt to make a joint bid with
another buyer, or we may purchase the portfolio of assets with the intent to
subsequently dispose of those assets which do not meet our investment
criteria. In the case of joint bids, however, it is possible that the other
buyer may default in its obligations, which increases the risk that the
acquisition may not close, with the adverse consequences described above. In
cases where we intend to dispose of assets that we do not wish to own, there
can be no assurance as to how quickly we will be able to sell or exchange
such asset or assets or the terms on which such asset or assets can be sold
or exchanged.
SUPPLEMENTAL PLAN OF DISTRIBUTION
Golf Trust is registering shares of Common Stock on behalf of
the selling shareholders. The selling shareholders are named in the attached
Prospectus. Since the date of the attached Prospectus, two named selling
shareholders redeemed a total of 4,800 OP Units for cash rather than Common
Stock, one named selling shareholder redeemed 11,700 OP Units for shares of
Common Stock which he then sold in a private transaction, one named selling
shareholder redeemed 30,000 OP Units for shares of Common Stock which he sold
or intends to sell pursuant to the separate prospectus supplement dated
January 5, 1999 and one named selling shareholder redeemed 2,000 OP Units for
shares of Common Stock which he sold or intends to sell pursuant to the
separate prospectus supplement dated March 24, 1999. As used herein and
therein, the term "selling shareholder" also includes donees and pledgees
selling shares received from a named selling shareholder after the date of
the attached Prospectus. All costs, expenses and fees in connection with the
registration of the shares offered hereby will be borne by the Company.
Brokerage commissions and similar selling expenses, if any, attributable to
the sale of shares will be borne by the selling shareholders. Sales of shares
may be effected by selling shareholders from time to time in one or more
types of transactions (which may include block transactions) on the American
Stock Exchange, in the over-the-counter market, in negotiated transactions,
through put or call options transactions relating to the shares, through
short sales of shares, or a combination of such methods of sale, at market
prices prevailing at the time of sale or at negotiated prices. Such
transactions may or may not involve brokers or dealers. The selling
shareholders have advised us that they have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers
regarding the sale of their securities, nor is there an underwriter or
coordinating broker acting in connection with the proposed sale of shares of
Common Stock by the selling shareholders.
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The selling shareholders may effect such transactions by
selling shares of Common Stock directly to purchasers or to or through
broker-dealers, which may act as agents or principals. Such broker-dealers
may receive compensation in the form of discounts, concessions, or
commissions from the selling shareholders and/or the purchasers of shares for
whom such broker-dealers may act as agents or to whom they sell as principal,
or both (which compensation as to a particular broker-dealer might be in
excess of customary commissions).
The selling shareholders and any broker-dealers that act in
connection with the sale of the shares might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, and any
commissions received by such broker-dealers and any profit on the resale of
the shares sold by them while acting as principals might be deemed to be
underwriting discounts or commissions under the Securities Act of 1933, as
amended. The Company has agreed to indemnify each selling shareholder
against certain liabilities, including liabilities arising under the
Securities Act. The selling shareholders may agree to indemnify any agent,
dealer or broker-dealer that participates in transactions involving sales of
the shares against certain liabilities, including liabilities arising under
the Securities Act.
Because selling shareholders may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act, the
selling shareholders will be subject to the prospectus delivery requirements
of the Securities Act, which may include delivery through the facilities of
the American Stock Exchange pursuant to Rule 153 under the Securities Act.
The Company has informed the selling shareholders that the anti-manipulative
provisions of Regulation M promulgated under the Securities Exchange Act of
1934, as amended, may apply to their sales in the market.
Selling shareholders also may resell all or a portion of
their shares of Common Stock in open market transactions in reliance upon
Rule 144 under the Securities Act, provided they meet the criteria and
conform to the requirements of such Rule.
Upon Golf Trust being notified by a selling shareholder that
any material arrangement has been entered into with a broker-dealer for the
sale of shares through a block trade, special offering, exchange distribution
or secondary distribution or a purchase by a broker or dealer, an additional
supplement to the accompanying Prospectus will be filed, if required,
pursuant to Rule 424(b) under the Securities Act, disclosing (a) the name of
each such selling shareholder and of the participating broker-dealer(s), (b)
the number of shares involved, (c) the price at which such shares were sold,
(d) the commissions paid or discounts or concessions allowed to such
broker-dealer(s), where applicable, (e) that such broker-dealer(s) did not
conduct any investigation to verify the information set out or incorporated
by reference in this Prospectus and (f) other facts material to the
transaction. In addition, upon the Company being notified by a selling
shareholder that a donee or pledgee intends to sell more than 500 shares of
Common Stock, an additional supplement to the accompanying Prospectus will be
filed.
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YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR
CONTAINED IN THIS PROSPECTUS OR ANY SUPPLEMENT. WE HAVE NOT AUTHORIZED
ANYONE ELSE TO PROVIDE YOU WITH DIFFERENT OR ADDITIONAL INFORMATION. WE ARE
NOT MAKING AN OFFER OF THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT
PERMITTED. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR
ANY SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF
THOSE DOCUMENTS.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
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Note Regarding Forward-Looking Statements .........S-2
Supplemental Plan of Distribution..................S-3
PROSPECTUS
Available Information............................... i
Incorporation of Certain Information by Reference....i
The Company..........................................1
Risk Factors.........................................2
Use of Proceeds.....................................15
Selling Shareholders................................15
Federal Income Tax Considerations...................16
Plan of Distribution................................31
Description of Capital Stock........................33
Description of Debt Securities......................42
Description of Warrants.............................58
Experts.............................................59
Legal Matters.......................................59
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5,349,113 SHARES
GOLF TRUST OF AMERICA, INC.
[logo]
COMMON STOCK
PROSPECTUS SUPPLEMENT
APRIL 19, 1999
