<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)*
FRANKLIN SELECT REALTY TRUST
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(Name of Issuer)
Common Stock, Series A
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(Title of Class of Securities)
354638-10-8
-----------------------------
(CUSIP Number)
N. Keith McKey
300 One Jackson Place, 188 East Capitol Street
Jackson, Mississippi 39201; (601) 354-3555
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 21, 1999
-----------------------------
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of secs.240.13d- 1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box [ ].
Note: Schedules filed in paper format shall include a signed original and five
copies of the Schedule, including all exhibits. See sec.240.13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
This Document contains 8 Pages.
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CUSIP NO. 354638-10-8 SCHEDULE 13D PAGE 2 OF 8 PAGES
------------ --- ---
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
EastGroup Properties, Inc.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)[ ]
(b)[ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Maryland
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NUMBER OF 7 SOLE VOTING POWER
SHARES 850,000
------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 850,000
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PERSON 10 SHARED DISPOSITIVE POWER
WITH -0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
850,000
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.9%
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14 TYPE OF REPORTING PERSON*
CO
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* SEE INSTRUCTIONS BEFORE FILLING OUT
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AMENDMENT NO. 2
TO
SCHEDULE 13D
The Statement on Schedule 13D, as amended (the "Schedule 13D")
relating to the shares of Common Stock, Series A, without par value, stated
value $10.00 per share ("Shares") of Franklin Select Realty Trust (the "Issuer")
filed with the Securities and Exchange Commission on June 11, 1998 by EastGroup
Properties, Inc. ("EastGroup"), and amended on July 29, 1998, is hereby further
amended as follows:
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 3 of the Schedule 13D is amended to read in its entirety
as follows:
As of the date hereof, EastGroup has used approximately
$5,130,047 to acquire its Shares. The source of the funds was
EastGroup's working capital. EastGroup's working capital
included funds obtained under a line of credit with Deposit
Guaranty National Bank, Jackson, Mississippi, which matured on
January 13, 1999 and bore interest at LIBOR plus 1.40%. On
January 13, 1999, EastGroup replaced this line of credit with
a three-year $150 million unsecured revolving credit facility
with a syndicate of ten banks that bears interest at the
Eurodollar rate plus 1.25%.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 of the Schedule 13D is amended by the addition of the
following:
On April 21, 1999, EastGroup delivered to the Issuer the
letter attached hereto as Exhibit I, incorporated herein by
this reference, that indicated that at the Issuer's 1999
Annual Meeting EastGroup intends to nominate a director of the
Issuer.
ITEM 5. INTEREST IN SECURITIES OF ISSUER.
Item 5 of the Schedule 13D is amended by the addition of the
following:
(i) SHARE OWNERSHIP. As of the date hereof, EastGroup
beneficially owns 850,000 Shares, or 6.9% of the
outstanding Shares. The percentage is based upon the
number of Shares indicated as outstanding in the
Issuer's 1998 Annual Report on Form 10-K
(12,250,372). No other Reporting Person beneficially
owns Shares. EastGroup did not acquire any Shares
Page 3 of 8 Pages
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during the 60-day period prior to the event requiring
filing of this Amendment.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
(I) Correspondence dated April 21, 1999 from EastGroup to
the Issuer.
Page 4 of 8 Pages
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
DATED: April 21, 1999
EASTGROUP PROPERTIES, INC.
By: /s/David H. Hoster II
------------------------------------------
David H. Hoster II
Chief Executive Officer and President
Page 5 of 8 Pages
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EASTGROUP PROPERTIES, INC.
188 EAST CAPITOL STREET
300 ONE JACKSON PLACE
JACKSON, MS 39201
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April 21, 1999
Board of Directors
Franklin Select Realty Trust
777 Mariners Island Boulevard
San Mateo, CA 94404
RE: ANNUAL MEETING OF SHAREHOLDERS
Gentlemen:
As you know, EastGroup Properties, Inc. ("EastGroup") is the largest
unaffiliated shareholder of Franklin Select Realty Trust (the "Company") with
the ownership of 850,000 shares of Series A Common Stock. You are also aware of
our disappointment and concern with respect to the Company's failure to
consummate a strategic transaction over an extended period of time. On June 3,
1998, the Company announced that a Special Committee of its Board of Directors
had determined "to undertake a review of the strategic alternatives available to
the Company." In this connection, the Special Committee retained Prudential
Securities as its exclusive financial advisor. While we do not question the
sincerity of the Company or the Board to pursue the Company's strategic
alternatives, we have frankly lost patience with a process that has continued
for over ten months - and appears may go on indefinitely - without a productive
result for Franklin Select or its shareholders. Remaining independent is
likewise not a viable course for the Company.
In order to maximize shareholder value, we have concluded that the
shareholders of the Company would be better served if there were a member of the
Board who clearly represented the interests of the Company's unaffiliated
shareholders. Accordingly, at the Company's Annual Meeting on April 27, 1999, we
intend to place the name of David H. Hoster II in nomination from the floor to
be a director of the Company. We also advise you that we will, in accordance
with the Company's By-Laws and California Law, give notice at the Meeting prior
to voting that we will cumulate the votes of the shares beneficially owned by
EastGroup. Mr. Hoster's resume is attached to this letter. As you can see, Mr.
Hoster has the required knowledge and experience to qualify as a Director and an
Independent Director under the Company's By-Laws.
Page 6 of 8 Pages
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BOARD OF DIRECTORS
FRANKLIN SELECT REALTY TRUST
APRIL 21, 1999
PAGE TWO
We desire that the nomination and voting procedures at the Annual
Meeting be orderly and efficient. We have provided you with notice of our
intentions so that we may have time to work together to ensure such nomination
and voting process.
We would be pleased to further discuss these matters at your
convenience.
Very truly yours,
EASTGROUP PROPERTIES, INC.
David H. Hoster II
President and CEO
Page 7 of 8 Pages
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<TABLE>
<CAPTION>
DAVID H. HOSTER II
PRESIDENT, DIRECTOR AND
CHIEF EXECUTIVE OFFICER
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EXPERIENCE
<S> <C> <C>
1993 - PRESENT EASTGROUP PROPERTIES JACKSON, MS
President, Director and Chief Executive Officer
EastGroup is a NYSE listed industrial real estate investment
trust with 14,500,000 square feet of industrial space in the
major sunbelt markets.
1993 - 1996 LNH REIT, INC. (MANAGED BY EASTGROUP PROPERTIES) JACKSON, MS
Executive Vice President (1993-1995), President (1995-1996)
1983 - 1993 EASTOVER GROUP OF COMPANIES JACKSON, MS
Executive Vice President of EastGroup Properties, Eastover
Corporation (merged into EastGroup in 1994), The Parkway
Company, Congress Street Properties (merged into Parkway 1994),
EB, Inc. (merged into Parkway 1995) and President of EastPark
Realty Trust (merged into Parkway 1990). Responsible for all
the real estate activities of a combined portfolio of $300
million in assets including acquisitions, dispositions,
development, mortgage administration and general asset
portfolio management
1975 - 1983 RIVIERE REALTY TRUST (EASTPARK REALTY TRUST) WASHINGTON D. C.
President and Executive Secretary. Responsible for all aspects
of the operation of a publicly held real estate investment
trust.
1972 - 1975 K. S. SWEET ASSOCIATES PHILADELPHIA, PA
Project Manager involved with real estate consulting and
structuring of large joint venture investments. Clients
included the Ford Foundation, Princeton University and Fidelity
Mutual Life Insurance Company.
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EDUCATION
<S> <C> <C>
1970 - 1972 STANFORD UNIVERSITY GRADUATE PALO ALTO, CA
SCHOOL OF BUSINESS
Received MBA with emphasis in finance and real estate.
1963 - 1967 PRINCETON UNIVERSITY PRINCETON, NJ
Received BA, cum laude.
<CAPTION>
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OTHER
<S> <C>
1967 - 1970 UNITED STATES ARMY
Obtained rank of First Lieutenant with service in
Vietnam.
1985 - 1987 Member of the Board of Governors of the National Association of Real
Estate Investment Trusts
Current Member of the Board of Directors of the Greater Jackson Foundation
Former member of the Boards of St. Andrew's Episcopal School
and Goodwill Industries of Mississippi
Member of the Society of International Business Fellows
</TABLE>
Page 8 of 8 Pages
