SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
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): November 26, 1996
Merry Land & Investment Company, Inc.
(Exact name of registrant as specified in its charter)
Georgia 001-11081
(State or other jurisdiction of incorporation) (Commission File Number)
58-0961876
(I.R.S. Employer I.D. Number)
624 Ellis Street, Augusta, Georgia 30901
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 706/722-6756
n/a
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(Former name or former address, if changed since last report)
**********************************************************************
Filed: November 26, 1996
<PAGE>
ITEM 5. OTHER EVENTS.
(a) BOARD AND MANAGEMENT. Merry Land & Investment Company,
Inc., ("Company") has increased the size of its Board of Directors from
five to seven naming Boone A. Knox and Michael N. Thompson as new
Directors. Mr. Knox will also serve as non-executive Chairman until such
time as Peter S. Knox III is able to return to his duties.
Boone A. Knox, 59 years old and brother of Peter S. Knox III, Chairman
and Chief Executive Officer of Merry Land, joins the Board of Directors as
acting non-executive Chairman. Peter Knox is ill and has suspended his
active participation in the affairs of the Company. Boone Knox is Chairman
of the Board and Chief Executive Officer of Allied Bankshares, Inc., a
publicly traded bank holding company based in Thomson, Georgia and is
director of Cousins Properties, Inc., an Atlanta based office and retail
REIT. Mr. Houston said that Boone Knox's financial acumen, public company
experience and knowledge of the REIT industry provide added strength and
continuity to Merry Land's Board.
Michael N. Thompson, 47 years old, has been appointed acting Chief
Operating Officer of the Company as well as a member of the Board. Mr.
Thompson has been Vice President of Acquisitions and Development for Merry
Land for the past five years and has been the chief architect of the rapid
growth of Merry Land's apartment portfolio in recent years.
The Company has also named W. Tennent Houston as acting Chief
Executive Officer during Peter S. Knox III's absence.
(b) ACQUISITIONS. The Company has previously reported the
acquisition of the Country Club Place Apartments, Estates at Quarry Lakes
Apartments and Shoal Run Apartments. Financial statements with respect to
these properties have been prepared and are being filed herewith.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
Statements of excess of revenues over specific operating expenses
with respect to the Country Club Place Apartments, Estates at Quarry Lakes
Apartments and Shoal Run Apartments are attached hereto as Exhibits 99.1,
99.2, and 99.3
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Merry Land & Investment Company,
Inc. (Registrant)
By:_____________________________
Dorrie E. Green
As Its Vice President
<PAGE>
COUNTRY CLUB PLACE
STATEMENTS OF THE EXCESS OF OPERATING REVENUES OVER
SPECIFIC OPERATING EXPENSES FOR THE EIGHT MONTHS ENDED
AUGUST 31,1996 (UNAUDITED) AND FOR THE YEAR ENDED
DECEMBER 31, 1995
TOGETHER WITH AUDITOR'S REPORT
<PAGE>
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and
Board of Directors of
Merry Land & Investment Company, Inc.:
We have audited the accompanying statement of excess of revenues over
specific operating expenses of COUNTRY CLUB PLACE for the year ended
December 31, 1995. This financial statement is the responsibility of
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 statement of excess of
revenue over specific operating expenses is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the statement of excess of revenues over
specific operating expenses. 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.
As described in Note 2, the financial statement excludes certain expenses
that would not be comparable with those resulting from the operations of
the property after acquisition by Merry Land & Investment Company, Inc. 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 property's revenue
and expenses.
In our opinion, the statement of excess of revenues over specific operating
expenses referred to above presents fairly, in all material respects, the
excess of revenues over specific operating expenses (exclusive of expenses
described in Note 2) of COUNTRY CLUB PLACE for the year ended December
31,1995 in conformity with generally accepted accounting principles.
Arthur Andersen LLP
Atlanta, Georgia
October 13, 1996
<PAGE>
COUNTRY CLUB PLACE
STATEMENTS OF EXCESS OF REVENUES OVER SPECIFIC OPERATING
EXPENSES FOR THE EIGHT MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
AND THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
1996 1995
---------- ----------
(Unaudited)
<S> <C> <C>
REVENUES:
Rents (Note 1) $916,934 $1,383,742
Other Income 39,870 50,088
---------- ----------
Total revenues 956,804 1,433,830
---------- ----------
SPECIFIC OPERATING EXPENSES (Note 2):
Personnel 90,681 97,143
General and administrative 11,186 14,743
Marketing 13,798 9,577
Repairs, maintenance, and contract services 80,397 128,597
Utilities 49,823 74,149
Property insurance 7,936 10,776
Real estate taxes 107,975 161,962
---------- ----------
361,796 496,947
---------- ----------
EXCESS OF REVENUES OVER SPECIFIC
OPERATING EXPENSES $595,008 $936,883
========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
COUNTRY CLUB PLACE
NOTES TO THE STATEMENTS OF EXCESS OF REVENUES
OVER SPECIFIC OPERATING EXPENSES
FOR THE EIGHT MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
AND FOR THE YEAR ENDED DECEMBER 31, 1995
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Description of Property
Country Club Place is a 152 unit apartment complex located in Pembroke
Pines, Florida. The complex is owned by John Hancock Mutual Life
Insurance Company and is managed by Summit Properties.
On September 27, 1996, Merry Land & Investment Company, Inc. ("Merry
Land") purchased the complex for $8.6 million cash.
Rental Income
Rents from leases are accounted for ratably over the term of each
lease which is generally for a period of twelve months or less.
2. BASIS OF ACCOUNTING
The accompanying statements of excess of revenues over specific
operating expenses are presented on the accrual basis. The statements
have been prepared in accordance with the applicable rules and
regulations of the Securities and Exchange Commission for real estate
properties acquired. Accordingly, the statements exclude certain
historical expenses not comparable to the operations of the property
after acquisition by Merry Land, such as depreciation, interest and
management fees.
Merry Land has elected to be taxed as a real estate investment trust
("REIT") under the Internal Revenue Code and intends to maintain its
qualification as a REIT in the future. Accordingly, no provision for
federal or state income taxes is required.
<PAGE>
THE ESTATES AT QUARRY LAKES
STATEMENTS OF THE EXCESS OF OPERATING REVENUES OVER
SPECIFIC OPERATING EXPENSES FOR THE EIGHT MONTHS ENDED
AUGUST 31,1996 (UNAUDITED) AND FOR THE YEAR ENDED
DECEMBER 31, 1995
TOGETHER WITH AUDITOR'S REPORT
<PAGE>
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and
Board of Directors of
Merry Land & Investment Company, Inc.:
We have audited the accompanying statement of excess of revenues over
specific operating expenses of THE ESTATES AT QUARRY LAKES for the year
ended December 31, 1995. This financial statement is the responsibility of
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 statement of excess of
revenue over specific operating expenses is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the statement of excess of revenues over
specific operating expenses. 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.
As described in Note 2, the financial statement excludes certain expenses
that would not be comparable with those resulting from the operations of
the property after acquisition by Merry Land & Investment Company, Inc. 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 property's revenue
and expenses.
In our opinion, the statement of excess of revenues over specific operating
expenses referred to above presents fairly, in all material respects, the
excess of revenues over specific operating expenses (exclusive of expenses
described in Note 2) of THE ESTATES AT QUARRY LAKES for the year ended
December 31,1995 in conformity with generally accepted accounting
principles.
Arthur Andersen LLP
Atlanta, Georgia
October 13, 1996
<PAGE>
THE ESTATES AT QUARRY LAKES
STATEMENTS OF EXCESS OF REVENUES OVER SPECIFIC OPERATING
EXPENSES FOR THE EIGHT MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
AND THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
1996 1995
---------- ----------
(Unaudited)
<S> <C> <C>
REVENUES:
Rents (Note 1) $1,210,520 $356,645
Other Income 28,359 12,471
---------- ----------
Total revenues 1,238,879 369,116
---------- ----------
SPECIFIC OPERATING EXPENSES (Note 2):
Personnel 128,777 152,485
General and administrative 13,486 20,910
Marketing 26,820 86,745
Repairs, maintenance, and contract services 84,880 45,125
Utilities 106,799 53,999
Property insurance 19,972 17,476
Real estate taxes 90,174 78,902
---------- ----------
470,908 464,391
---------- ----------
EXCESS OF REVENUES OVER SPECIFIC
OPERATING EXPENSES $767,971 $(95,275)
========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
THE ESTATES AT QUARRY LAKES
NOTES TO THE STATEMENTS OF EXCESS OF REVENUES
OVER SPECIFIC OPERATING EXPENSES
FOR THE EIGHT MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
AND FOR THE YEAR ENDED DECEMBER 31, 1995
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Description of Property
The Estates at Quarry Lakes is a 302 unit apartment complex located in
Austin, Texas. Construction of the property commenced in 1994 and the
first unit was occupied in June 1995. The complex is owned by
Riverside Resources Corporation, a Texas Corporation and managed by
Capstone Real Estate Services, Inc.
On September 27, 1996, ML Texas Apartments LP, an indirect subsidiary
of Merry Land & Investment Company, Inc. ("Merry Land"), purchased the
complex for approximately $5.3 million cash and $12.7 million in
assumed mortgage loans.
Rental Income
Rents from leases are accounted for ratably over the term of each
lease which is generally for a period of twelve months or less.
2. BASIS OF ACCOUNTING
The accompanying statements of excess of revenues over specific
operating expenses are presented on the accrual basis. The statements
have been prepared in accordance with the applicable rules and
regulations of the Securities and Exchange Commission for real estate
properties acquired. Accordingly, the statements exclude certain
historical expenses not comparable to the operations of the property
after acquisition by Merry Land, such as depreciation, interest and
management fees.
Merry Land has elected to be taxed as a real estate investment trust
("REIT") under the Internal Revenue Code and intends to maintain its
qualification as a REIT in the future. Accordingly, no provision for
federal or state income taxes is required.
<PAGE>
SHOAL RUN
STATEMENTS OF THE EXCESS OF OPERATING REVENUES OVER
SPECIFIC OPERATING EXPENSES FOR THE EIGHT MONTHS ENDED
AUGUST 31,1996 (UNAUDITED) AND FOR THE YEAR ENDED
DECEMBER 31, 1995
TOGETHER WITH AUDITOR'S REPORT
<PAGE>
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and
Board of Directors of
Merry Land & Investment Company, Inc.:
We have audited the accompanying statement of excess of revenues over
specific operating expenses of SHOAL RUN for the year ended December 31,
1995. This financial statement is the responsibility of 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 statement of excess of
revenue over specific operating expenses is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the statement of excess of revenues over
specific operating expenses. 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.
As described in Note 2, the financial statement excludes certain expenses
that would not be comparable with those resulting from the operations of
the property after acquisition by Merry Land & Investment Company, Inc. 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 property's revenue
and expenses.
In our opinion, the statement of excess of revenues over specific operating
expenses referred to above presents fairly, in all material respects, the
excess of revenues over specific operating expenses (exclusive of expenses
described in Note 2) of SHOAL RUN for the year ended December 31,1995 in
conformity with generally accepted accounting principles.
Arthur Andersen LLP
Atlanta, Georgia
November 11, 1996
<PAGE>
SHOAL RUN
STATEMENTS OF EXCESS OF REVENUES OVER SPECIFIC OPERATING
EXPENSES FOR THE EIGHT MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
AND THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
1996 1995
---------- ----------
(Unaudited)
<S> <C> <C>
REVENUES:
Rents (Note 1) $1,108,589 $1,760,716
Other Income 25,851 41,047
---------- ----------
Total revenues 1,134,440 1,801,763
---------- ----------
SPECIFIC OPERATING EXPENSES (Note 2):
Personnel 120,936 167,212
General and administrative 9,743 17,453
Marketing 10,345 6,916
Repairs, maintenance, and contract services 53,639 83,528
Utilities 82,831 126,043
Property insurance 31,694 50,633
Real estate taxes 63,544 95,316
---------- ----------
372,732 547,101
---------- ----------
EXCESS OF REVENUES OVER SPECIFIC
OPERATING EXPENSES $761,708 $1,254,662
========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
SHOAL RUN
NOTES TO THE STATEMENTS OF EXCESS OF REVENUES
OVER SPECIFIC OPERATING EXPENSES
FOR THE EIGHT MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
AND FOR THE YEAR ENDED DECEMBER 31, 1995
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Description of Property
Shoal Run is a 276 unit apartment complex located in Birmingham,
Alabama. The complex is owned by Balcor Pension Investors and managed
by Insignia Management Group.
On September 13, 1996, ML Alabama Apartments Inc., a wholly-owned
subsidiary of Merry Land & Investment Company, Inc. ("Merry Land"),
purchased the complex for $10.8 million cash.
Rental Income
Rents from leases are accounted for ratably over the term of each
lease which is generally for a period of twelve months or less.
2. BASIS OF ACCOUNTING
The accompanying statements of excess of revenues over specific
operating expenses are presented on the accrual basis. The statements
have been prepared in accordance with the applicable rules and
regulations of the Securities and Exchange Commission for real estate
properties acquired. Accordingly, the statements exclude certain
historical expenses not comparable to the operations of the property
after acquisition by Merry Land, such as depreciation, interest and
management fees.
Merry Land has elected to be taxed as a real estate investment trust
("REIT") under the Internal Revenue Code and intends to maintain its
qualification as a REIT in the future. Accordingly, no provision for
federal or state income taxes is required.
