===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended: July 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from ___________ to _____________
Commission file number: 1-3647
J. W. MAYS, INC.
(Exact name of registrant as specified in its charter)
New York 11-1059070
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9 Bond Street, Brooklyn, New York 11201-5805
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (718) 624-7400
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $1 per share
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No. .
-- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.[X] No delinquent filers.
The aggregate market value of voting stock held by nonaffiliates of the
registrant was approximately $7,073,777 as of September 29, 1995 based upon the
closing price on the NASDAQ National Market System reported for such date.
Shares of Common Stock held by each officer and director and by each person who
owns 5% or more of the outstanding Common Stock have been excluded in that such
persons may be deemed to be affiliates. This determination of affiliate status
is not necessarily a conclusive determination for other purposes.
The number of shares outstanding of the registrant's Common Stock as of
September 29, 1995 was 2,136,397.
DOCUMENTS INCORPORATED BY REFERENCE
Part of Form 10-K
in which the Document
Document is incorporated
-------- ---------------------
Annual Report to Shareholders for
Fiscal Year Ended July 31, 1995 ...................... Parts I and II
Definitive Proxy Statement for the
1995 Annual Meeting of Shareholders .................. Part III
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<PAGE>
J. W. MAYS, INC.
FORM 10-K FOR THE FISCAL YEAR ENDED JULY 31, 1995
TABLE OF CONTENTS
Part I PAGE
----
Item 1. Business .................................................. 3
Item 2. Properties ................................................ 3
Item 3. Legal Proceedings ......................................... 4
Item 4. Submission of Matters to a Vote of Security Holders ....... 5
Executive Officers of the Registrant ............................... 5
Part II
Item 5. Market for Registrant's Common Stock and Related
Shareholder Matters ..................................... 5
Item 6. Selected Financial Data ................................... 5
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations ..................... 5
Item 8. Financial Statements and Supplementary Data ............... 5
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure .................. 6
Part III
Item 10. Directors and Executive Officers of the Registrant ........ 6
Item 11. Executive Compensation .................................... 6
Item 12. Security Ownership of Certain Beneficial
Owners and Management ................................... 6
Item 13. Certain Relationships and Related Transactions ............ 6
Part IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K ................................ 6
2
<PAGE>
PART I
Item 1. Business.
J. W. Mays, Inc. (the "Company" or "Registrant") with executive offices at
9 Bond Street, Brooklyn, New York 11201, operates a number of commercial real
estate properties. See below for the description of these properties (Item 2.
Properties). The Company's business was founded in 1924 and incorporated under
the laws of the State of New York on July 6, 1927.
The Company discontinued its department store business which operated under
the name of "MAYS," in the year ended July 31, 1989, and has continued the
leasing of real estate. The Company has no foreign operations or export sales.
The Company employs approximately 31 employees and has a contract with a
union covering rates of pay, hours of employment and other conditions of
employment for approximately 19% of its employees. The Company considers that
its labor relations with its employees and union are good.
Item 2. Properties.
The table below sets forth certain information as to each of the properties
currently operated by the Company:
<TABLE>
<CAPTION>
Approximate
Location Owned or leased(1) Square Feet
-------- ------------------ -----------
<S> <C> <C>
Brooklyn, New York
Fulton Street at Bond Street .................. (2) 380,000(5)
Jamaica, New York
Jamaica Avenue at 169th Street ................ Own Building, Lease Fee 297,000(6)
Fishkill, New York
Interstate Highway 84 at Route 9 .............. (3) 211,000(7)
(located on
14.9 acres)
Brooklyn, New York
Jowein Building
Fulton Street and Elm Place ................... (4) 430,000(8)
Levittown, New York
Hempstead Turnpike ............................ (3) 85,800(9)
Massapequa, New York
Sunrise Highway ............................... (10) 133,400(10)
Circleville, Ohio
Tarlton Road .................................. (3) 193,350(11)
(located on
11.6 acres)
</TABLE>
----------
(1) Properties leased are under long-term leases for varying periods, the
longest of which extends to 2013, and in most instances renewal options
are included. Reference is made to Note 6 to the Consolidated Financial
Statements contained in the 1995 Annual Report to Shareholders,
incorporated herein by reference. The properties indicated as owned
which are held subject to mortgage are the Jowein building, the Fishkill
property, the Ohio property and a small part of the Company's former
Brooklyn store.
(Footnotes continued)
3
<PAGE>
(2) A major portion of these premises is owned.
(3) The entire premises is owned.
(4) Approximately 50% of these premises is owned and the remainder is
leased.
(5) Approximately 99,000 square feet of the street floor and basement are
leased to one tenant for retail and approximately 9,000 square feet, in
the aggregate, are leased to four separate tenants for retail and
offices. Approximately 232,000 square feet of the building are available
for lease.
(6) Approximately 75,100 square feet are leased to one tenant, 47,100 square
feet to another tenant and 2,700 square feet to a third tenant, all for
retail. Approximately 137,000 square feet of the building are available
for lease.
(7) Approximately 102,000 square feet are leased to one tenant for retail
and 109,000 square feet of the building are available for lease of which
25,000 square feet was leased on August 31, 1995.
(8) All of the building, except for 164,000 square feet, has been leased for
retail and offices. The 164,000 square feet are available for lease. Of
the 430,000 square feet, 266,000 square feet have been leased for retail
and offices, including leases for retail space entered into on June 8,
1995 for 26,000 square feet and on July 6, 1995 for 24,000 square feet.
(9) Leased to one tenant for retail.
(10) Leased by the Company and sub-leased to two tenants for a bank and a
gasoline service station.
(11) Property purchased in December, 1992 under lease to one tenant for use
as a distribution facility.
The City of New York through its Economic Development Administration ("New
York City") constructed a municipal garage at Livingston Street opposite the
Company's Brooklyn properties. The Company has a long-term lease with New York
City expiring in 2013 with renewal options, the last of which expires in 2073,
under which:
(1) Such garage, available to the public, provides truck bays and
passage facilities through a tunnel for the exclusive use of the Company,
to the structure referred to in (2) below; the bays, passage facilities and
tunnel, totaling approximately 17,000 square feet, are included in the
lease from New York City mentioned in the preceding paragraph and are in
full use.
(2) The Company constructed a six-story building and basement on a 20
x 75-foot plot (acquired and made available by New York City and leased to
the Company for a term expiring in 2013 with renewal options, the last of
which expires in 2073) adjacent to and connected with the Company's
Brooklyn properties, which provides the other end of the tunnel with the
truck bays in the municipal garage.
See Note 11 to the Consolidated Financial Statements of the 1995 Annual
Report to Shareholders, which information is incorporated herein by reference,
for information concerning those tenants the rental income from which equals 10%
or more of the Company's rental income.
Item 3. Legal Proceedings.
There are various lawsuits and claims pending against the Company. It is
the opinion of management that the resolution of these matters will not have a
material adverse effect on the Company's Consolidated Financial Statements.
4
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders.
During the fourth quarter of the fiscal year covered by this report, no
matter was submitted to a vote of security holders of the Company.
Executive Officers of the Registrant
The following information is furnished with respect to each Executive
Officer of the Registrant (each of whom is elected annually) whose present term
of office will expire upon the election and qualification of his successor:
<TABLE>
<CAPTION>
First Became
Business Experience During Such Officer
Name Age the Past Five Years or Director
---- --- -------------------------- ------------
<S> <C> <C> <C>
Max L. Shulman ................... 86 Chairman of the Board June, 1963
Co-Chairman of the Board June, 1995
Director January, 1946
Lloyd J. Shulman ................. 53 President November, 1978
Co-Chairman of the Board and
President June, 1995
Director November, 1977
Alex Slobodin .................... 80 Executive Vice President November, 1965
Treasurer September, 1955
Director November, 1963
Ward N. Lyke, Jr. ................ 44 Vice President February, 1984
George Silva ..................... 45 Vice President March, 1995
Salvatore Cappuzzo ............... 36 Secretary November, 1981
</TABLE>
No family relationship exists among the foregoing persons except that Lloyd
J. Shulman is the son of Max L. Shulman.
All of the above mentioned officers have been appointed as such by the
directors and, except for Mr. Silva, have been employed as Executive Officers of
the Company during the past five years.
PART II
Item 5. Market for Registrant's Common Stock and Related Shareholder Matters.
The information appearing under the heading "Common Stock Prices and
Dividends" on page 20 of the Registrant's 1995 Annual Report to Shareholders is
incorporated herein by reference.
Item 6. Selected Financial Data.
The information appearing under the heading "Summary of Selected Financial
Data" on page 2 of the Registrant's 1995 Annual Report to Shareholders is
incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
The information appearing under the heading "Management's Discussion and
Analysis of Financial Condition and Results of Operations" on pages 18 and 19 of
the Registrant's 1995 Annual Report to Shareholders is incorporated herein by
reference.
Item 8. Financial Statements and Supplementary Data.
The Registrant's Consolidated Financial Statements, together with the
report of Lipsky, Goodkin & Co., P.C., Independent Public Accountants, dated
October 12, 1995, appearing on pages 4 through 16 of the Registrant's 1995
Annual Report to Shareholders is incorporated herein by reference. With the
exception of the aforementioned
5
<PAGE>
information and the information incorporated by reference in Items 2, 5, 6, 7
and 8 hereof, the 1995 Annual Report to Shareholders is not to be deemed filed
as part of this Form 10-K Annual Report.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The information relating to directors of the Registrant is contained in the
Definitive Proxy Statement for the 1995 Annual Meeting of Shareholders and such
information is incorporated herein by reference.
The information with respect to Executive Officers of the Registrant is set
forth in Part I hereof.
Item 11. Executive Compensation.
The information required by this item appears under the heading "Executive
Compensation and Related Matters" in the Definitive Proxy Statement for the 1995
Annual Meeting of Shareholders and such information is incorporated herein by
reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The information required by this item appears under the headings "Security
Ownership of Certain Beneficial Owners and Management" and "Information
Concerning Nominees for Election as Directors" in the Definitive Proxy Statement
for the 1995 Annual Meeting of Shareholders and such information is incorporated
herein by reference.
Item 13. Certain Relationships and Related Transactions.
The information required by this item appears under the heading "Executive
Compensation and Related Matters" in the Definitive Proxy Statement for the 1995
Annual Meeting of Shareholders and such information is incorporated herein by
reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) The following documents are filed as part of this report:
1. The Consolidated Financial Statements and report of Lipsky,
Goodkin & Co., P.C., Independent Public Accountants dated October
12, 1995, set forth on pages 4 through 16 of the Registrant's
1995 Annual Report to Shareholders.
2. See accompanying Index to Registrant's Financial Statements and
Schedules.
3. Exhibits:
(2) Plan of acquisition, reorganization, arrangement, liquidation
or succession--not applicable.
(3) Articles of incorporation and by-laws:
(i) Certificate of Incorporation, as amended, incorporated
by reference to Registrant's Form 8-K dated December 3,
1973.
(ii) By-laws, as amended June 1, 1995--Exhibit A, attached.
(4) Instruments defining the rights of security holders,
including indentures--see Exhibit (3) above.
(9) Voting trust agreement--not applicable.
6
<PAGE>
(10) Material contracts:
(i) Agreement of Lease dated March 29, 1990 pursuant to
which the basement and a portion of the street floor,
approximately 32% of the total area of the Registrant's
former Jamaica store, has been leased to a tenant for
retail space, incorporated by reference to Registrant's
Form 10-K dated October 29, 1990.
(ii) Agreement of Lease dated July 5, 1990, as amended
February 25, 1992, pursuant to which a portion of the
street floor and basement, approximately 35% of the
total area of the Registrant's former Brooklyn store,
has been leased to a tenant for the retail sale of
general merchandise and for a restaurant, incorporated
by reference to Registrant's Form 10-K dated October
29, 1990.
(iii) The J.W. Mays, Inc. Retirement Plan and Trust, Summary
Plan Description, effective August 1, 1991,
incorporated by reference to Registrant's Form 10-K
dated October 23, 1992 and, as amended, effective
August 1, 1993, incorporated by reference to
Registrant's Form 10-Q for the Quarter ended October
31, 1993 dated December 2, 1993.
(11) Statement re computation of per share earnings--not
applicable.
(12) Statement re computation of ratios--not applicable.
(13) Annual report to security holders.
(18) Letter re change in accounting principles--not applicable.
(21) Subsidiaries of the registrant.
(22) Published report regarding matters submitted to vote of
security holders--not applicable.
(23) Consents of experts and counsel--not applicable.
(24) Power of attorney--none.
(28) Information from reports furnished to state insurance
regulatory authorities--not applicable.
(99) Additional exhibits--none.
(b) Reports on Form 8-K -- A report on Form 8-K was filed by the Registrant
during the three months ended July 31, 1995.
Item reported -- The Company entered into an Agreement of Lease (the
"Lease"), dated July 6, 1995, pursuant to which approximately 24,000 square
feet of space in the Jowein Building located in the Fulton Mall in downtown
Brooklyn, New York was leased to a chain store tenant for retail space. The
term of the Lease is for a period of fourteen years and six months and
commences in November, 1995. The lease provides for fixed rent aggregating
approximately $2,375,000 in the initial five-year period of the Lease,
$2,529,375 for the next five-year period and $2,424,406 for the remaining
four years and six month period. In addition, the Lease provides that the
tenant pay its proportionate share of certain items, including operating
expenses, and its proportionate share of real estate taxes over a base
year.
Financial Statements filed -- None
Date of Report filed -- July 6, 1995
7
<PAGE>
SIGNATURES
Pursuant to the requirements of Sections 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
J. W. MAYS, INC.
------------------------------------
(REGISTRANT)
October 23, 1995 By: LLOYD J. SHULMAN
------------------------------------
Lloyd J. Shulman
Co-Chairman of the Board
Principal Executive Officer
President
Principal Operating Officer
October 23, 1995 By: ALEX SLOBODIN
------------------------------------
Alex Slobodin
Executive Vice President
and Treasurer
Principal Financial Officer
October 23, 1995 By: MARK GREENBLATT
------------------------------------
Mark Greenblatt
Controller
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
MAX L. SHULMAN Co-Chairman of the Board October 23, 1995
-------------------------------- and Director
Max L. Shulman
LLOYD J. SHULMAN Co-Chairman of the Board, October 23, 1995
-------------------------------- Chief Executive Officer,
Lloyd J. Shulman President, Chief Operating Officer
and Director
ALEX SLOBODIN Executive Vice President, October 23, 1995
-------------------------------- Treasurer and Director
Alex Slobodin
FRANK J. ANGELL Director October 23, 1995
--------------------------------
Frank J. Angell
JACK SCHWARTZ Director October 23, 1995
--------------------------------
Jack Schwartz
SYLVIA W. SHULMAN Director October 23, 1995
--------------------------------
Sylvia W. Shulman
LEWIS D. SIEGEL Director October 23, 1995
--------------------------------
Lewis D. Siegel
</TABLE>
8
<PAGE>
INDEX TO REGISTRANT'S FINANCIAL STATEMENTS AND SCHEDULES
Reference is made to the following sections of the Registrant's Annual
Report to Shareholders for the fiscal year ended July 31, 1995, which are
incorporated herein by reference:
Report of Independent Accountants (page 16)
Consolidated Balance Sheets (pages 4 and 5)
Consolidated Statements of Operations and Retained Earnings (page 6)
Consolidated Statements of Cash Flows (page 7)
Notes to Consolidated Financial Statements (pages 8-16)
Page
----
Financial Statement Schedules:
Report of Independent Accountants .......................... 9
II Valuation and Qualifying Accounts .......................... 10
III Real Estate and Accumulated Depreciation ................... 11
All other schedules for which provision is made in the applicable
regulations of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable and, accordingly, are omitted.
The separate financial statements and schedules of J. W. Mays, Inc. (not
consolidated) are omitted because the Company is primarily an operating company
and its subsidiaries are wholly-owned.
---------------
REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULES
To the Board of Directors and Shareholders
of J. W. Mays, Inc.:
Our audits of the Consolidated Financial Statements referred to in our
report dated October 12, 1995, appearing on page 16 of the 1995 Annual Report to
Shareholders of J.W. Mays, Inc., (which report and Consolidated Financial
Statements are incorporated by reference in this Annual Report on Form 10-K)
also included an audit of the Summarized Financial Information contained in Item
8 and Financial Statement Schedules listed in Item 14(a)(2) of this Form 10-K.
Our report on the Consolidated Financial Statements includes explanatory
paragraphs with respect to the change in the method of accounting for marketable
securities--other investments in 1995 and a change in the method of accounting
for income taxes in 1994 as discussed in Note 1 to the Consolidated Financial
Statements. In our opinion, this Summarized Financial Information and these
Financial Statement Schedules present fairly, in all material respects, the
information set forth therein when read in conjunction with the related
Consolidated Financial Statements.
LIPSKY, GOODKIN & Co., P.C.
New York, N.Y
October 12, 1995 (except with respect to
the matter discussed in Note 16(b) to
the Consolidated Financial Statements, as
to which the date is October 20, 1995)
9
<PAGE>
SCHEDULE II
J.W. MAYS, INC.
VALUATION AND QUALIFYING ACCOUNTS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
Year ended July 31, 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Allowance for net unrealized gains (losses) on
marketable securities--other investments:
Balance, beginning of period ........................... $(31,769) $ -- $ --
Additions charged to expense ........................... -- (31,769) --
Reductions ............................................. 73,779 -- --
-------- -------- -----
Balance, end of period ................................. $ 42,010 $(31,769) $ --
======== ======== =====
Deferred income tax asset valuation allowance:
Balance, beginning of period ........................... $169,698 $ -- $ --
Additions charged to expense ........................... -- 169,698 --
Reductions ............................................. 52,600 -- --
-------- -------- -----
Balance, end of period ................................. $117,098 $169,698 $ --
======== ======== =====
</TABLE>
10
<PAGE>
SCHEDULE III
J. W. MAYS, INC.
REAL ESTATE AND ACCUMULATED DEPRECIATION
July 31, 1995
<TABLE>
<CAPTION>
====================================================================================================================================
Col. A Col. B Col. C Col. D Col. E
- ------------------------------------------------------------------------------------------------------------------------------------
Cost Capitalized Gross Amount at
Initial Cost Subsequent to Which Carried
to Company Acquisition at Close of Period
----------------------- ----------------------- ----------------------------------
Encum- Building & Carrying Building &
Description brances Land Improvements Improvements Cost Land Improvements Total
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Office and Rental Buildings
Brooklyn, New York
Fulton Street at Bond Street .... $ 215,902 $1,703,157 $ 3,862,454 $ 6,176,403 $ -- $1,703,157 $10,038,857 $11,742,014
Jamaica, New York
Jamaica Avenue at
169th Street .................... -- -- 3,215,699 3,929,938 -- -- 7,145,637 7,145,637
Fishkill, New York
Interstate Highway 84
at Route 9 ...................... 2,769,412 467,341 7,212,116 1,638,710 -- 467,341 8,850,826 9,318,167
Brooklyn, New York
Jowein Building
Fulton Street and Elm Place ..... 975,037 1,622,232 770,561 7,999,017 -- 1,622,232 8,769,578 10,391,810
Levittown, New York
Hempstead Turnpike .............. -- 95,256 200,560 72,990 -- 95,256 273,550 368,806
Circleville, Ohio
Tarlton Road .................... 2,398,767 120,849 4,388,456 -- -- 120,849 4,388,456 4,509,305
---------- ---------- ----------- ----------- ------ --------- ----------- -----------
Total (A) ....................... $6,359,118 $4,008,835 $19,649,846 $19,817,058 $ -- $4,008,83 $39,466,904 $43,475,739
========== ========== =========== =========== ====== ========= =========== ===========
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================================
Col. F Col. G Col. H Col. I
- ------------------------------------------------------------------------------------------------------------------------------------
Life on Which
Depreciation in
Latest Income
Accumulated Date of Date Statement Is
Depreciation Construction Acquired Computed
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Office and Rental Buildings
Brooklyn, New York
Fulton Street at Bond Street .... $ 4,214,566 Various Various (1)(2)
Jamaica, New York
Jamaica Avenue at
169th Street .................... 4,788,552 1959 1959 (1)(2)
Fishkill, New York
Interstate Highway 84
at Route 9 ...................... 3,981,064 10/74 11/72 (1)
Brooklyn, New York
Jowein Building
Fulton Street and Elm Place ..... 4,903,037 1915 1950 (1)(2)
Levittown, New York
Hempstead Turnpike .............. 237,276 4/69 6/62 (1)
Circleville, Ohio
Tarlton Road .................... 274,278 9/92 12/92 (1)
-----------
Total (A) ....................... $18,398,773
===========
</TABLE>
- ----------
(1) Building and improvements 18-40 years
(2) Improvements to leased property 3-40 years
(A) Does not include Office Furniture and Equipment and Transportation Equipment
in the amount of $650,431 and Accumulated Depreciation thereon of $441,462
at July 31, 1995.
<TABLE>
<CAPTION>
Years Ended July 31,
---------------------------------------
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Investment in Real Estate
Balance at Beginning of Year ......... $42,529,020 $40,821,164 $35,221,015
Improvements ......................... 946,719 1,707,856 5,600,149
----------- ----------- -----------
Balance at End of Year ............... $43,475,739 $42,529,020 $40,821,164
=========== =========== ===========
Accumulated Depreciation
Balance at Beginning of Year ......... $17,617,239 $16,857,024 $16,175,219
Additions Charged to Costs and
Expenses ........................... 781,534 760,215 681,805
----------- ----------- -----------
Balance at End of Year ............... $18,398,773 $17,617,239 $16,857,024
=========== =========== ===========
</TABLE>
11
<PAGE>
EXHIBIT INDEX TO FORM 10-K
(2) Plan of acquisition, reorganization, arrangement, liquidation or
succession--not applicable
(3) (i) Articles of incorporation--incorporated by reference
(ii) By-laws--Exhibit A
(4) Instruments defining the rights of security holders, including
indentures--see Exhibit (3) above
(9) Voting trust agreement--not applicable
(10) Material contracts--(i) through (iii) incorporated by reference
(11) Statement re computation of per share earnings-not applicable
(12) Statement re computation of ratios--not applicable
(13) Annual report to security holders
(18) Letter re change in accounting principles--not applicable
(21) Subsidiaries of the registrant
(22) Published report regarding matters submitted to vote of security
holders--not applicable
(23) Consents of experts and counsel--not applicable
(24) Power of attorney--none
(28) Information from reports furnished to state insurance regulatory
authorities-not applicable
(99) Additional exhibits--none
EXHIBIT 13
(Copy of Annual Report to Shareholders attached hereto)
Fiscal Year Ended July 31, 1995
(NEXT PAGE)
EXHIBIT 21
Subsidiaries of the Registrant
The Registrant owns all of the outstanding stock of the following
corporations, which are included in the Consolidated Financial Statements filed
with this report:
DUTCHESS MALL SEWAGE PLANT, INC. (a New York corporation)
J. W. M. Realty Corp. (an Ohio corporation)
EXHIBIT A
===============================================================================
By-Laws
OF
J. W. MAYS, INC.
(A New York Corporation)
As Amended June 1, 1995
===============================================================================
<PAGE>
J.W. MAYS, INC.
--------------
BY-LAWS
ARTICLE I
MEETINGS OF SHAREHOLDERS
SECTION:
1.1. Annual Meetings. The annual meeting of the shareholders of J.W. Mays,
Inc. (hereinafter called the Corporation), for the election of directors and for
the transaction of such other business as may be brought before the meeting,
shall be held on the last Tuesday of November of each year, or as soon
thereafter as practicable, and shall be held at a place and time determined by
the board of directors (the "Board").
1.2. Special Meetings. Special meetings of the shareholders may be called
by resolution of the Board or by the President and shall be called by the
President upon the written request (stating the purpose or purposes of the
meeting) of a majority of the Board or of the holders of 20% of the outstanding
shares entitled to vote. Only business related to the purposes set forth in the
notice of the meeting may be transacted at a special meeting. The time and place
at which any special meeting of the shareholders shall be held shall be fixed by
the Board or the President, as the case may be, who shall have called such
meeting; provided, however, that the time so fixed shall be such as will permit
the giving of notice as hereinafter provided in Section 1.4. Special meetings
may also be called and held in such cases and in such manner as may be
specifically provided by law.
1.3. Place of Meetings. Meetings of the shareholders may be held in or
outside New York State.
1.4. Notice of Meetings; Waiver of Notice. Written notice of each meeting
of shareholders shall be given to each shareholder entitled to vote at the
meeting, except that (a) it shall not be necessary to give notice to any
shareholder who waives, in person or by proxy, such notice in writing including
waiver by telegraph, cable or wireless whether before or after the meeting, and
(b) no notice of an adjourned meeting need be given if the time and place to
which the meeting is adjourned are announced at the meeting at which the
adjournment is taken except as may otherwise be required by law. Each notice of
meeting shall be given, personally or by mail, not less than 10 nor more than 50
days before the meeting and shall state the place, date and hour of the meeting,
and unless it is the annual meeting, shall state at whose direction the meeting
is called and the purposes for which it is called. If mailed, notice shall be
considered given when deposited in the United States mail, with postage thereon
prepaid, directed to the shareholder at his address as it appears on the record
of shareholders or to such other address as he may direct by notice in writing
to Corporation. The attendance of any shareholder at a meeting, in person or by
proxy, without protesting prior to the conclusion of the meeting the lack of
notice of the meeting, shall constitute a waiver of notice by him.
1.5. Quorum. The presence in person or by proxy of the holders of majority
of the shares entitled to vote shall constitute a quorum for the transactions of
any business. In the absence of a quorum a majority in voting interest of those
present or, in the absence of all the shareholders, any officer entitled to
preside at or to act as secretary of the meeting, may adjourn the meeting until
a quorum is present. At any adjournment meeting at which a quorum is present any
action may be taken which might have been taken at the meeting as originally
called.
1.6. Voting; Proxies. Every shareholder entitled to vote at a meeting of
shareholders or to express consent or dissent without a meeting may authorize
another person or persons to act for him by
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<PAGE>
proxy. Each shareholder of record shall be entitled at every meeting of
shareholders to one vote for every share registered in his name on the record of
shareholders. Corporate action to be taken by shareholder vote, other than the
election of directors, shall be authorized by a majority of the votes cast at a
meeting of shareholders, except as otherwise provided by law. Directors shall be
elected in the manner provided in Section 2.3 of these by-laws. Voting need not
be by ballot unless requested by a shareholder at the meeting or ordered by the
person presiding at the meeting. Every proxy must be signed by the shareholder
or his attorney-in-fact. No proxy shall be valid after eleven months from its
date unless it provides otherwise.
1.7. Inspectors of Election. The person presiding at a meeting of
shareholders may appoint one or more inspectors who may be shareholders or their
proxies, but not directors of the Corporation or candidates for such office.
Each inspector, before entering upon the discharge of his duties, shall take and
sign an oath faithfully to execute the duties of inspector at such meeting with
strict impartiality and according to the best of his ability. The inspector or
inspectors shall have such duties and powers prescribed by law. On request of
the person presiding at the meeting or any shareholder entitled to vote thereat,
the inspectors shall make a report in writing of any challenge, question or
matter determined by them and execute a certificate of any fact found by them.
Any report or certificate made by them, shall be prima facie evidence of the
facts stated and of the vote as certified by them.
ARTICLE II
BOARD OF DIRECTORS
SECTION:
2.1. General Powers and Qualification. The business of the Corporation
shall be managed by the board of directors each of whom shall be at least 21
years of age. At least one of them shall be a citizen of the United States and a
resident of the State of New York. Directors need not be shareholders of the
Corporation.
2.2. Manner of Determining Number of Directors to be Chosen. The number of
directors to be chosen within the maximum limits fixed by the certificate of
incorporation, shall be determined in the following manner: At each meeting of
shareholders for the election of directors and before the taking of a vote
thereon, the number of directors to be elected at such meeting shall be fixed
and determined by a majority vote of the stock represented at the meeting in
person or by proxy, provided, however, that at any time or times between annual
elections of directors, the existing directors may, by a majority vote of the
entire Board, increase the number of directors up to the maximum limits fixed by
the certificate of incorporation and in connection with any such increase, the
directors may, by like vote, designate the additional director or directors who
shall continue in office until the next annual meeting and until his successor
shall be elected and qualified. By a majority vote of the entire Board, the
Board may decrease the number of directors to not less than three but no
decrease shall shorten the term of any incumbent director.
2.3. Elections. Directors shall be elected by a plurality of the votes cast
at a meeting of shareholders by the holders of shares entitled to vote in the
election and shall hold office until the next annual meeting of shareholders and
until their successors have been elected and qualified.
2.4. Resignations. Any director of the Corporation may resign at any time
by giving written notice to the President or the Secretary. Such resignation
shall take effect at the time specified therein; and, unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.
2.5. Vacancies. Any vacancy in the Board, whether caused by death,
resignation or removal with or without a cause or otherwise may be filled by the
vote of a majority of the directors then in office,
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though less than a quorum. Vacancies occurring in the Board by reason of
removal of a director without cause by shareholders may also be filled by vote
of shareholders at a special meeting called for that purpose.
2.6. Place of Meetings. Meetings of the Board may be held in or outside New
York State.
2.7. Annual and Regular Meetings. Annual meetings of the Board, for the
election of officers and consideration of other matters, shall be held either
(a) without notice immediately after the annual meeting of shareholders and at
the same place, or (b) as soon as practicable after the annual meeting of
shareholders, on notice as provided in Section 2.8 of these by-laws. Regular
meetings of the Board may be held without notice if the time and place of such
meetings are fixed by the Board. If the day fixed for a regular meeting is a
legal holiday, the meeting shall be held on the next business day.
2.8. Special Meetings. Special meetings of the Board shall be held upon
notice to the directors and may be called by the Chairman of the Board, either
of the Co-Chairmen, if so elected by the Board, the President or by any two of
the directors.
2.9. Notice of Meetings; Waiver of Notice. Notice of the time and place of
each special meeting of the Board, and of each annual meeting not held
immediately after the annual meeting of shareholders and at the same place,
shall be given to each director by mailing it to him at his residence or usual
place of business at least three days before the meeting or by delivering or
telephoning or telegraphing it to him at least two days before the meeting. A
notice, or waiver of notice, need not specify the purpose of any regular or
special meeting of the Board. Notice need not be given to any director who
submits a signed waiver of notice before or after the meeting, or who attends
the meeting without protesting the lack of notice to him, either before the
meeting or when it begins. Any meeting of the Board shall be a legal meeting
without any notice having been given or regardless of the giving of any notice
or the adoption of any resolution in reference thereto, if every member of the
Board shall be present thereat.
2.10. Removal of Directors. Any or all of the directors may be removed at
anytime, either with or without cause, by vote of the shareholders, and any of
the directors may be removed for cause by action of the Board.
2.11. Quorum and Action by the Board. At all meetings of the Board, the
presence of a majority of the directors then in office, but in no event less
than three, shall be necessary to constitute a quorum, except as provided in
Section 2.5 of these by-laws. Unless otherwise provided by law or these by-laws,
the vote of a majority of the directors present at the time of the vote, if a
quorum is present at such time, shall be the act of the Board. In the absence of
a quorum, a majority of the directors present may adjourn the meeting sine die,
or from time to time until a quorum is present. Notice of any adjourned meeting
need not be given otherwise than by announcement at the meeting at which the
adjournment is taken.
2.12. Executive Committee. The Board, by resolution adopted by a majority
of the entire Board, may designate an Executive Committee of three or more
directors which shall have all the authority of the Board, except as otherwise
provided in the resolution or by law, and which shall serve at the pleasure of
the Board. All action of the Executive Committee shall be reported to the Board
at its next meeting. The Executive Committee shall adopt rules of procedure and
shall meet as provided by those rules or by resolutions of the Board.
2.13. Other Committees. The Board, by resolution adopted by a majority of
the entire Board, may designate other committees of directors, to serve at the
Board's pleasure, with such powers and duties as the Board determines.
2.14. Alternate Members. The Board may designate one or more directors as
alternate members of any committee, who may replace any absent member or members
at any meeting of such committee.
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2.15. Compensation. Directors shall receive such compensation as the Board
determines, together with reimbursement of their reasonable expenses in
connection with the performance of their duties. A director may also be paid for
serving the Corporation, its affiliates or subsidiaries in other capacities.
2.16. Action Without Meeting. Any action required or permitted to be taken
by the Board or any committee thereof may be taken without a meeting if all
members of the Board or the committee consent in writing to the adoption of a
resolution authorizing the action. The resolution and the written consents
thereto by the members of the Board or committee shall be filed with the minutes
of the proceedings of the Board or committee.
2.17. Participation in Board or Committee Meetings by Conference Telephone.
Any one or more members of the Board or any committee thereof may participate in
a meeting of such Board or committee by means of a conference telephone or
similar communications equipment allowing all persons participating in the
meeting to hear each other at the same time. Participation by such means shall
constitute presence in person at a meeting.
ARTICLE III
OFFICERS
SECTION:
3.1. Number; Powers and Duties. The executive officers of the Corporation
shall be the Chairman of the Board [if so elected by the Board] or either or
both of the Co-Chairmen [if so elected by the Board], the President, one or more
Vice Presidents (including, at the election of the Board, a Senior Vice
President and one or more Executive Vice Presidents), a Secretary, a Treasurer,
and such other officers as it may determine. Any two or more offices may be held
by the same person, except the offices of President and Secretary. The executive
officers shall have such authority and perform such duties in the management of
the Corporation as may be provided in these by-laws, or to the extent not so
provided, by the Board. In the case of more than one person holding an office of
the same title, any one of them may perform the duties of the office except
insofar as the Board of Directors may otherwise direct.
3.2. Election; Term of Office. The executive officers of the Corporation
shall be elected annually by the Board and each such officer shall hold office,
subject to the provisions of law and of these by-laws, until the next annual
meeting of the Board and until his successor has been elected and qualified.
3.3. Subordinate Officers. The Board may appoint subordinate officers
(including a Controller, one or more Assistant Secretaries and Assistant
Treasurers), agents or employees, each of whom shall hold office for such period
and have such powers and duties as the Board determines. The Board may delegate
to any executive officer or to any committee the power to appoint, define the
powers and duties and fix the compensation of, any subordinate officers, agents
or employees.
3.4. Resignation and Removal of Officers. Any officer may resign at any
time by giving written notice to the President or the Secretary. Any such
resignation shall take effect at the time specified therein; and, unless
otherwise specified therein, the acceptance of such resignation shall not be
necessary to make it effective. Any officer elected or appointed by the Board or
appointed by an executive officer or by a committee may be removed by the Board
either with or without cause.
3.5. Vacancies. A vacancy in any office may be filled for the unexpired
term in the manner prescribed in Sections 3.2 and 3.3 of these by-laws for
election or appointment to the office.
3.6. Chairman or Co-Chairmen of the Board. There may be one Chairman of the
Board or, if so elected by the Board, there may be two individuals serving as
Co-Chairmen. The Board of Directors may
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from time to time determine the respective responsibilities of the Co-Chairmen.
Any conflict between the Co-Chairmen shall be resolved by a vote of a majority
of the entire Board. The Chairman of the Board, or one of the Co-Chairmen, as
determined by the Board, shall be the Chief Executive Officer of the
Corporation. The Chairman of the Board, or either of such Co-Chairmen, if so
elected by the Board, shall preside at all meetings of the Board and of the
shareholders, and shall have such other powers and duties in the management of
the Corporation as such Chairman or Co-Chairmen of the Board or as a Chief
Executive Officer usually has or as the Board assigns to him or them, as the
case may be. In the event that the Board elects Co-Chairmen, either or both may
be designated officers of the Corporation.
3.7. The President. The President shall be the Chief Operating Officer of
the Corporation and shall, in the absence of the Chairman of the Board, or the
Co-Chairmen, if so elected by the Board, or in case of his [or their] inability
to act, or at the request of the Chairman of the Board, or one of the
Co-Chairmen, if so elected by the Board, preside at meetings of the Board and of
the shareholders, and shall be a member of all standing committees appointed by
the Board. Subject to the powers of the Chairman of the Board, or the
Co-Chairmen, if so elected by the Board, and the provisions of Section 3.6 and
subject further to the control of the Board, he shall have general supervision
over the business of the Corporation and shall have such other powers and duties
as Presidents of corporations usually have or as the Board or the Executive
Committee, if any, assigns him.
3.8. The Vice Presidents. In the absence or inability to act of the
President, the Senior Vice President (if there be one, and, if not, then the
Vice President, including any Executive Vice President, designated by the
Board), shall perform all the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the President
under these by-laws. The Vice Presidents shall perform such other duties and
have such authority as from time to time may be assigned to them by the Board or
the President.
3.9. The Treasurer and Assistant Treasurer. The Treasurer shall be the
chief financial officer of the Corporation and shall be in charge of the
Corporation's books and accounts. Subject to the control of the Board, he shall
have such other powers and duties as the Board or the President assigns to him.
In the absence or inability to act of the Treasurer, the Assistant
Treasurer designated by the Board shall perform all the duties of the Treasurer
and, when so acting, shall have all the powers of, and be subject to all the
restrictions upon, the Treasurer under these by-laws.
3.10. The Secretary and Assistant Secretary. The Secretary shall be the
secretary of, and keep the minutes of, all meetings of the Board and of the
shareholders, shall be responsible for giving notice of all meetings of
shareholders and of the Board, shall keep the seal and, when authorized by the
Board, shall apply it to any instrument requiring it. Subject to the control of
the Board, he shall have such other powers and duties as the Board or the
President assigns to him.
In the absence or inability to act of the Secretary, the Assistant
Secretary designated by the Board shall perform all of the duties of the
Secretary and, when so acting, shall have all the powers of, and be subject to
all the restrictions upon, the Secretary imposed by these by-laws. In the
absence of the Secretary or an Assistant Secretary from any meeting, the minutes
shall be kept by the person appointed for that purpose by the presiding officer.
3.11. Security; Surety Bond. The Board may require any officer, agent or
employee to give security for the faithful performance of his duties. Such
security may be in the form of a bond in such sum and with such surety or
sureties as the Board may approve.
3.12. Salaries. The salaries of the officers shall be fixed from time to
time by the Board, provided, however, that the Board may authorize the President
to fix the salary of any other officer. No
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<PAGE>
officer shall be prevented from receiving compensation by reason of the fact
that he is also a director of the Corporation.
ARTICLE IV
VOTING UPON STOCK IN OTHER CORPORATIONS
SECTION:
4.1. Manner of Voting. Unless otherwise ordered by the Board, any shares of
stock held by the Corporation in any other corporation may be voted on behalf of
the Corporation by the Chairman of the Board, or either of the Co-Chairmen, if
so elected by the Board, or the President of the Corporation.
ARTICLE V
SHARES OF STOCK
SECTION:
5.1. Form of Certificates. The stock of the Corporation shall be
represented by certificates in such form as shall be approved by the Board. The
certificates of stock shall be signed by the Chairman of the Board, or one of
the Co-Chairmen, if so elected by the Board, or the President or a Vice
President and the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer and sealed with the seal of the Corporation; provided,
however, that such seal may be a facsimile engraved or printed. The signatures
of the officers upon a certificate may be facsimiles engraved or printed if the
certificate is countersigned by a Transfer Agent or registered by a Registrar
other than the Corporation itself or its employee. In case any officer who has
signed or whose facsimile signature has been placed upon the certificate shall
have ceased to be such officer before such certificate is issued, it may be
issued by the Corporation with the same effect as if he were such officer at the
date of issue.
5.2. Transfers of Shares. Shares shall be transferable only on the books of
the Corporation by the holder thereof, or by his attorney thereunto duly
authorized by power of attorney duly executed and filed with the Secretary of
the Corporation or the Transfer Agent thereof, and upon the surrender of the
certificate or certificates for such shares properly endorsed. No transfers of
shares shall be valid as against the Corporation, its shareholders and creditors
for any purpose, except to render the transferee liable for the debts of the
Corporation to the extent provided by law, until it shall have been entered on
the books of the Corporation by an entry showing from and to whom transferred.
5.3. Lost, Destroyed or Stolen Certificates. The Corporation may issue a
new certificate representing shares of stock of the Corporation in the place of
any certificate theretofore issued by it alleged to have been lost, destroyed or
stolen. The Board may, in its discretion, as a condition to the issue of any
such new certificate, require the owner of the lost, destroyed or stolen
certificate, or his legal representative, to make proof satisfactory to the
Board of the loss, destruction or theft thereof and to give the Corporation a
bond in such sum, and with such surety or sureties as the Board may direct
sufficient to indemnify the Corporation against any claim that may be made
against it on account of the alleged loss, destruction or theft of any such
certificate or the issuance of any such new certificate.
5.4. Fixing, Record Date. For the purpose of determining the shareholders
entitled to notice of or to vote at any meeting of shareholders or any
adjournment thereof, or to express consent to or dissent from any proposal
without a meeting, or for the purposes of determining shareholders entitled to
receive payment of any dividend or the allotment of any rights, or for the
purpose of any other action, the Board may fix, in advance, a date as the record
date for any such determination of shareholders. Such date shall not be more
than fifty nor less than ten days before the date of such meeting, nor more than
fifty days prior
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to any other action. When a determination of shareholders of record entitled to
notice of or to vote at any meeting of shareholders has been made as provided
in this section, such determination shall apply to any adjournment thereof,
unless the Board fixes a new record date under this section for the adjourned
meeting.
ARTICLE VI
MISCELLANEOUS
SECTION:
6.1. Reserves. In its absolute discretion, the Board may, from its earned
surplus or capital surplus, create reserves in such amount or amounts for any
proper purpose or purposes which the Board may think conducive to the best
interests of the Corporation and may increase, decrease or abolish any such
reserve.
6.2. Seal. The corporate seal shall be in the form of a circle and shall
bear the full name of the Corporation, the year of its organization, and the
words "Corporate Seal N.Y." or words and figures of similar import. In lieu of
the corporate seal, when so authorized by the Board, facsimiles thereof may be
impressed or affixed or reproduced.
6.3. Fiscal Year. The Board may determine the Corporation's fiscal year.
Until changed by the Board, the Corporation's fiscal year shall commence on
August 1 and terminate at the close of business on July 31.
6.4. Definitions.
(a) Certificate of Incorporation shall mean the certificate of
incorporation of the Corporation, as amended, supplemented or restated by
certificate of amendment, merger or consolidation or other certificates or
instruments filed or issued under any statute, from time to time.
(b) The words "entire board" mean the total number of directors which
the Corporation would have if there were no vacancies.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS AND OFFICERS
SECTION:
7.1. Except to the extent expressly prohibited by the New York Business
Corporation Law, the Corporation shall indemnify each person made, or threatened
to be made, a party to any action or proceeding, whether criminal or civil, by
reason of the fact that such person or such person's testator or intestate is or
was a director or officer of the Corporation, or is or was serving, in any
capacity, at the request of the Corporation, any other corporation, or any
partnership, joint venture, trust, employee benefit plan or other enterprise,
against judgments, fines, penalties, amounts paid in settlement and reasonable
expenses, including attorneys' fees and expenses, reasonably incurred in
enforcing such person's right to indemnification, incurred in connection with
such action or proceeding, or any appeal therein, provided that no such
indemnification shall be made if a judgment or other final adjudication adverse
to such person establishes that such person's acts were committed in bad faith
or were the result of active and deliberate dishonesty and were material to the
cause of action so adjudicated, or that such person personally gained in fact a
financial profit or other advantage to which such person was not legally
entitled, and provided further that no such indemnification shall be required
with respect to any settlement or other nonadjudicated disposition of any
threatened or pending action or proceeding unless the Corporation has given its
prior consent to such settlement or other disposition.
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7.2. The Corporation shall advance or promptly reimburse upon request any
person entitled to indemnification hereunder for all reasonable expenses,
including attorneys' fees and expenses, reasonably incurred in defending any
action or proceeding in advance of the final disposition thereof upon receipt of
an undertaking by or on behalf of such person to repay such amount if such
person is ultimately found not to be entitled to indemnification or, where
indemnification is granted, to the extent the expenses so advanced or reimbursed
exceed the amount to which such person is entitled; provided, however, that such
person shall cooperate in good faith with any request by the Corporation that
common counsel be used by the parties to an action or proceeding who are
similarly situated unless to do so would be inappropriate due to actual or
potential differing interests between or among such parties.
7.3. Nothing herein shall limit or affect any right of any director,
officer or other corporate personnel otherwise than hereunder to indemnification
of expenses, including attorneys' fees, under any statute, rule, regulation,
certificate of incorporation, by-law, insurance policy, contract or otherwise;
without affecting or limiting the rights of any director, officer or other
corporate personnel pursuant to this Article VII, the Corporation is authorized
to enter into agreements with any of its directors, officers or other corporate
personnel extending rights to indemnification and advancement of expenses to the
fullest extent permitted by applicable law.
7.4. Anything in these by-laws to the contrary notwithstanding, no
elimination or amendment of this Article VII adversely affecting the right of
any person to indemnification or advancement of expenses hereunder shall be
effective until the 60th day following notice to such person of such action, and
no elimination of or amendment to this Article VII shall deprive any such
person's rights hereunder arising out of alleged or actual occurrences, acts or
failures to act prior to such 60th day.
7.5. The Corporation shall not, except by elimination or amendment of this
Article VII in a manner consistent with the preceding Section 7.4, take any
corporate action or enter into any agreement which prohibits, or otherwise
limits the rights of any person to, indemnification in accordance with the
provisions of this Article VII. The indemnification of any person provided by
this Article VII shall continue after such person has ceased to be a director or
officer of the Corporation and shall inure to the benefit of such person's
heirs, executors, administrators and legal representatives.
7.6. In case any provision in this Article VII shall be determined at any
time to be unenforceable in any respect, the other provisions of this Article
VII shall not in any way be affected or impaired thereby, and the affected
provision shall be given the fullest possible enforcement in the circumstances,
it being the intention of the Corporation to afford indemnification and
advancement of expenses to its directors or officers, acting in such capacities
or in the other capacities mentioned herein, to the fullest extent permitted by
law.
ARTICLE VIII
AMENDMENTS
SECTION:
8.1. Amendments. By-laws may be amended, repealed or adopted by the
shareholders or by a majority of the entire Board, but any by-law adopted by the
Board may be amended or repealed by the shareholders. If any by-law regulating
an impending election of directors is adopted, amended or repealed by the Board,
the notice of the next meeting of shareholders for the election of directors
shall set forth the by-law so adopted, amended or repealed, together with a
concise statement of the changes made.
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================================================================================
J. W. MAYS, INC.
Annual Report
1995
Year Ended July 31, 1995
================================================================================
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<PAGE>
Contents
Page No.
Summary of Selected Financial Data 2
Company Profile 2
Message to Shareholders 3
Consolidated Balance Sheets 4-5
Consolidated Statements of Operations
and Retained Earnings 6
Consolidated Statements of Cash Flows 7
Notes to Consolidated Financial Statements 8-16
Report of Independent Accountants 16
Five Year Summary of
Consolidated Operations 17
Management's Discussion and
Analysis of Financial Condition
and Results of Operations 18-19
Quarterly Financial Information (Unaudited) 20
Common Stock Prices and Dividends 20
Officers and Directors 21
Executive Offices
9 Bond Street, Brooklyn, N.Y. 11201
Transfer Agent and Registrar
American Stock Transfer & Trust Company
40 Wall Street
New York, N.Y. 10005
Special Counsel
Cullen and Dykman
177 Montague Street
Brooklyn, N.Y. 11201
Independent Accountants
Lipsky, Goodkin & Co., P.C.
120 W. 45th Street
New York, N.Y. 10036
Common Stock
The Company's common stock trades on
The Nasdaq Stock Market under the
symbol: "Mays".
Annual Meeting
The Annual Meeting of Shareholders will be
held on Tuesday, November 28, 1995, at
10:00 A.M., New York time, at J. W. MAYS, INC.,
9 Bond Street, Brooklyn, New York.
1
<PAGE>
J.W. MAYS, INC.
Summary of Selected Financial Data
(dollars in thousands except per share data)
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Rental Income .............................................. $ 8,330 $ 9,523 $10,030 $ 9,299 $ 8,178
Gain on Sale of Property and Equipment ..................... -- -- 1 -- 3
Gain on Condemnation Award ................................. -- -- 639 -- --
- --------------------------------------------------------------------------------------------------------------------
Total Revenues ............................................. 8,330 9,523 10,670 9,299 8,181
- --------------------------------------------------------------------------------------------------------------------
Income (Loss) from Continuing Operations Before
Cumulative Effect of Changes in Accounting
Principles and Extraordinary Item ........................ (394) (32) 1,464 856 95
(Loss) from Discontinued Operations ........................ -- -- -- (47) (319)
Cumulative Effect of Changes in Accounting Principles:
Accounting for Certain Investments in Debt
and Equity Securities .................................. 22 -- -- -- --
Accounting for Income Taxes .............................. -- (275) -- -- --
Extraordinary Item--Utilization of Net Operating
Loss Carryforward ........................................ -- -- 709 416 --
- --------------------------------------------------------------------------------------------------------------------
Net Income (Loss) .......................................... (372) (307) 2,173 1,225 (224)
- --------------------------------------------------------------------------------------------------------------------
Working Capital ............................................ 2,478 4,629 3,816 7,457 8,290
- --------------------------------------------------------------------------------------------------------------------
Total Assets ............................................... 36,144 37,290 36,384 32,245 31,910
- --------------------------------------------------------------------------------------------------------------------
Long-Term Debt:
Mortgages Payable ......................................... 5,954 6,359 4,315 4,509 4,685
Other ..................................................... 678 672 668 664 659
------- ------- ------- ------- -------
Total ................................................... 6,632 7,031 4,983 5,173 5,344
- --------------------------------------------------------------------------------------------------------------------
Shareholders' Equity ....................................... 27,293 27,637 28,028 26,056 24,831
- --------------------------------------------------------------------------------------------------------------------
Income (Loss) Per Common Share:
Continuing Operations .................................... (.18) (.02) .67 .39 .04
Discontinued Operations .................................. -- -- -- (.02) (.14)
Cumulative Effect of Changes in Accounting
Principles:
Accounting for Certain Investments in Debt
and Equity Securities .............................. .01 -- -- -- --
Accounting for Income Taxes .......................... -- (.13) -- -- --
Extraordinary Item--Utilization of
Net Operating Loss Carryforward ........................ -- -- .33 .19 --
------- ------- ------- ------- -------
Net Income (Loss) Per Common Share ..................... $ (.17) $ (.15) $ 1.00 $ .56 $ (.10)
- --------------------------------------------------------------------------------------------------------------------
Cash Dividends Declared Per Share .......................... -- -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
Average common shares outstanding for 1995, 2,136,397; 1994, 2,137,440; 1993,
2,171,124; each of the years 1991 and 1992, 2,178,297.
Company Profile
- --------------------------------------------------------------------------------
J.W. Mays, Inc. was founded in 1924 and incorporated under the laws of the
State of New York on July 6, 1927.
The Company operates a number of commercial real estate properties located
in Brooklyn and Jamaica in New York City, in Levittown, Long Island, New York,
in Fishkill, Dutchess County, New York and in Circleville, Ohio. The major
portion of these properties is owned and the balance is leased. A substantial
percentage of these properties is leased to tenants while the remainder is
available for lease.
More comprehensive information concerning the Company appears in its Annual
Report on Form 10-K for the fiscal year ended July 31, 1995.
2
<PAGE>
J.W. MAYS, INC.
To Our Shareholders:
- --------------------------------------------------------------------------------
In the current year, the financial results of the Company continue to be
adversely affected by the loss in fiscal 1994 of two major tenants. On the
positive side, the Company has leased to two retail tenants 50,000 sq. ft. of
the 99,000 sq. ft. surrendered by a former lessee in the Jowein Building located
in the Fulton Mall in downtown Brooklyn, New York. It has also leased 25,000 sq.
ft. of the 100,000 sq. ft. vacated by a former tenant in the Fishkill, New York
property. The rent income from these new leases will substantially offset the
loss in rent from the aforesaid two major tenants.
The leases for the Brooklyn tenants are scheduled to commence during the
month of November, 1995 and the lease for the space in the Fishkill property is
anticipated to commence in December, 1995.
For the fiscal year ended July 31, 1995, our Company reported a loss of
$372,039, or $.17 per share, consisting of a loss from operations of $393,808,
or $.18 per share, reduced by the cumulative effect of the change in accounting
for certain investments in debt and equity securities of $21,769, or $.01 per
share. There was no comparable item in the 1994 twelve month period.
In the comparable 1994 twelve month period, the loss amounted to $307,466,
or $.15 per share, consisting of a loss from operations of $32,466, or $.02 per
share, and the cumulative effect of a change in accounting for income taxes of
$275,000, or $.13 per share. The operating loss included a bad debt amounting to
$708,673 arising from a pre-bankruptcy petition claim and a court approved lease
rejection granted to one of the major tenants referred to above. There were no
comparable items in the 1995 fiscal year.
As previously announced, at the Board of Directors' meeting held May 24,
1995, Max L. Shulman, then Chairman and Chief Executive Officer of the Company,
vacated the position of Chief Executive Officer effective June 1, 1995. He was
elected Co-Chairman of the Board of Directors and continues as a director and as
an employee of the Company.
Lloyd J. Shulman, at the same directors' meeting, effective June 1, 1995,
was elected Co-Chairman of the Board of Directors and also assumed the position
of Chief Executive Officer. He will continue as President and Chief Operating
Officer and as a director of the Company.
We have confidence in our ability to face the current issues in the real
estate industry. To you, our shareholders, we extend our appreciation for your
support. With our newly signed leases and through the efforts of our dedicated
employees, we look forward to being able to report a profitable 1996 fiscal
year.
Sincerely,
Signature
Max L. Shulman
Co-Chairman
Signature
Lloyd J. Shulman
Co-Chairman, Chief Executive
Officer and President and
Chief Operating Officer
3
<PAGE>
J.W. MAYS, INC.
Consolidated Balance Sheets
July 31, 1995 and 1994
<TABLE>
<CAPTION>
Assets
1995 1994
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Property and Equipment--At cost (Notes 1 and 3):
Buildings and improvements ........................................................ $30,867,736 $30,326,774
Improvements to leased property ................................................... 8,215,035 8,193,410
Fixtures and equipment ............................................................ 483,208 470,026
Land .............................................................................. 4,008,835 4,008,835
Other ............................................................................. 167,223 161,108
Construction in progress .......................................................... 384,133 --
----------- -----------
44,126,170 43,160,153
Less accumulated depreciation and amortization .................................... 18,840,235 18,018,305
----------- -----------
Property and equipment--net ................................................... 25,285,935 25,141,848
----------- -----------
Current Assets:
Cash and cash equivalents ......................................................... 490,315 602,289
Marketable securities--other investments (Notes 1, 2 and 9) ....................... 2,799,712 4,796,778
Receivables ....................................................................... 244,992 373,003
Deferred income taxes ............................................................. 27,000 40,000
Prepaid expenses .................................................................. 1,121,694 1,162,619
Income taxes refundable ........................................................... -- 22,005
----------- -----------
Total current assets .......................................................... 4,683,713 6,996,694
----------- -----------
Other Assets:
Deferred charges (Note 1) ......................................................... 2,329,140 2,221,671
Less accumulated amortization ..................................................... 913,311 786,180
----------- -----------
Net ........................................................................... 1,415,829 1,435,491
Security deposits ................................................................. 458,641 258,136
Unbilled receivables (Note 1) ..................................................... 4,026,435 3,321,939
Receivables (Note 7) .............................................................. 109,687 135,898
Marketable securities--other investments (Notes 1, 2 and 9) ....................... 164,063 --
----------- -----------
Total other assets ............................................................ 6,174,655 5,151,464
----------- -----------
TOTAL ASSETS .................................................................. $36,144,303 $37,290,006
=========== ===========
</TABLE>
See Notes to Consolidated Financial Statements.
4
<PAGE>
Liabilities and Shareholders' Equity
<TABLE>
<CAPTION>
1995 1994
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Long-Term Debt:
Mortgages payable (Note 3) ...................................................... $ 5,954,306 $ 6,359,119
Other (Note 4) .................................................................. 677,597 672,038
----------- -----------
Total long-term debt ........................................................ 6,631,903 7,031,157
----------- -----------
Deferred Income Taxes ............................................................. 14,000 254,000
----------- -----------
Current Liabilities:
Payable to securities broker (Note 9) ........................................... 1,225,100 1,123,513
Accounts payable ................................................................ 64,744 91,530
Payroll and other accrued liabilities (Note 8) .................................. 487,956 565,844
Income taxes payable ............................................................ 18,588 --
Other taxes payable ............................................................. 4,081 3,648
Current portion of long-term debt--mortgages payable (Note 3) ................... 404,813 583,167
----------- -----------
Total current liabilities ................................................... 2,205,282 2,367,702
----------- -----------
Total liabilities ........................................................... 8,851,185 9,652,859
----------- -----------
Shareholders' Equity:
Common stock, par value $1 each share (shares--5,000,000
authorized; 2,178,297 issued) ................................................. 2,178,297 2,178,297
Capital surplus ................................................................. 3,346,245 3,346,245
Unrealized gain on available for sale securities (Note 2) ....................... 28,010 --
Retained earnings ............................................................... 22,024,806 22,396,845
----------- -----------
27,577,358 27,921,387
Less common stock held in treasury, at cost--
41,900 shares at 1995 and 1994 ................................................. 284,240 284,240
----------- -----------
Total shareholders' equity .................................................. 27,293,118 27,637,147
----------- -----------
Commitments and Contingencies (Note 15)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY .................................. $36,144,303 $37,290,006
=========== ===========
</TABLE>
5
<PAGE>
J.W. MAYS, INC.
Consolidated Statements of Operations and Retained Earnings
<TABLE>
<CAPTION>
Years Ended July 31,
-----------------------------------------------
1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Revenues
Rental income ................................................... $ 8,330,182 $ 9,522,528 $10,029,444
Gain on sale of property and equipment .......................... -- -- 1,268
Gain on condemnation award ...................................... -- -- 639,048
----------- ----------- -----------
Total revenues ............................................. 8,330,182 9,522,528 10,669,760
----------- ----------- -----------
Expenses
Real estate operating expenses .................................. 5,580,161 5,611,835 5,508,540
Administrative and general expenses ............................. 2,157,610 2,840,030 2,074,774
Depreciation and amortization ................................... 838,063 822,727 748,314
----------- ----------- -----------
Total expenses ............................................. 8,575,834 9,274,592 8,331,628
----------- ----------- -----------
Income (loss) from operations before investment income,
interest expense and income taxes ............................... (245,652) 247,936 2,338,132
----------- ----------- -----------
Investment income and interest expense
Investment income ............................................... 366,911 384,545 562,447
Interest expense ................................................ 641,067 596,947 564,649
----------- ----------- -----------
(274,156) (212,402) (2,202)
----------- ----------- -----------
Income (loss) from operations before income taxes ................. (519,808) 35,534 2,335,930
Income taxes (benefit) ............................................ (126,000) 68,000 872,000
----------- ----------- -----------
Income (loss) from operations before cumulative effect
of changes in accounting principles and extraordinary item ...... (393,808) (32,466) 1,463,930
Cumulative effect of changes in accounting principles:
Accounting for certain investments in debt and
equity securities ............................................. 21,769 -- --
Accounting for income taxes ..................................... -- (275,000) --
Extraordinary item--utilization of net operating loss
carryforward .................................................... -- -- 709,000
----------- ----------- -----------
Net income (loss) ................................................. (372,039) (307,466) 2,172,930
Retained earnings, beginning of year .............................. 22,396,845 22,704,311 20,531,381
----------- ----------- -----------
Retained earnings, end of year .................................... $22,024,806 $22,396,845 $22,704,311
=========== =========== ===========
Income (loss) per common share:
Income (loss) from operations ................................... $ (.18) $ (.02) $ .67
Cumulative effect of change in accounting principles:
Accounting for certain investments in debt and
equity securities ........................................... .01 -- --
Accounting for income taxes ................................... -- (.13) --
Extraordinary item--utilization of net operating
loss carryforward ............................................. -- -- .33
----------- ----------- -----------
Net income (loss) per common share ......................... $ (.17) $ (.15) $ 1.00
=========== =========== ===========
Dividends per share ............................................... -- -- --
=========== =========== ===========
Average common shares outstanding ................................. 2,136,397 2,137,440 2,171,124
=========== =========== ===========
</TABLE>
See Notes to Consolidated Financial Statements.
6
<PAGE>
J.W. MAYS, INC.
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
Years Ended July 31,
---------------------------------------------
1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Flows From Operating Activities
Income (loss) from continuing operations ........................... $ (393,808) $ (32,466) $1,463,930
Extraordinary item--utilization of net operating loss
carryforward ..................................................... -- -- 709,000
---------- ---------- ----------
Net income (loss) .................................................. (393,808) (32,466) 2,172,930
Adjustments to reconcile net income (loss) to net cash
provided from (used in) operating activities:
Deferred income taxes .......................................... (251,000) (61,000) --
Amortization of premium on marketable debt
securities ................................................... 2,171 4,986 8,440
Unrealized loss on marketable securities ....................... -- 31,769 --
Realized gain on marketable securities ......................... (13,643) (18,924) (5,437)
Gain on sale of property and equipment ......................... -- -- (1,268)
Depreciation and amortization .................................. 838,063 822,727 748,314
Amortization of deferred expenses .............................. 127,131 230,823 122,743
Other assets--deferred expenses ................................ (107,469) (231,767) (32,785)
--security deposits ................................ (200,505) (57,762) 3,174
--unbilled receivables ............................. (704,496) (7,204) (614,561)
--receivables ...................................... 26,211 (135,898) --
Changes in:
Receivables ...................................................... 128,011 (10,153) 225,575
Prepaid expenses ................................................. 40,925 21,497 (4,739)
Income taxes refundable .......................................... 22,005 (22,005) --
Accounts payable ................................................. (26,786) (36,511) 84,396
Payroll and other accrued liabilities ............................ (77,888) (60,250) (161,227)
Income taxes payable ............................................. 18,588 (29,898) 23,285
Other taxes payable .............................................. 433 364 244
---------- ---------- ----------
Net cash provided (used) by operating activities ....... (572,057) 408,328 2,569,084
---------- ---------- ----------
Cash Flows From Investing Activities
Acquisition of property and equipment .............................. (982,150) (1,719,703) (5,655,581)
Marketable securities--other investments:
Receipts from sales or maturities ................................ 2,333,962 699,798 2,952,818
Payments for purchases ........................................... (415,708) (760,503) (1,652,982)
Proceeds from sale of property and equipment ......................... -- -- 7,000
---------- ---------- ----------
Net cash provided (used) by investing activities ....... 936,104 (1,780,408) (4,348,745)
---------- ---------- ----------
Cash Flows From Financing Activities
Borrowings--securities broker ...................................... 2,697,663 2,551,633 4,271,031
Payments--securities broker ........................................ (2,596,076) (3,819,903) (1,879,248)
Increase (reduction) of mortgage debt--short-term .................. (178,354) 389,102 18,176
--long-term ................... (399,254) 2,048,556 (190,004)
Purchase of treasury stock ......................................... -- (83,300) (200,940)
---------- ---------- ----------
Net cash provided (used) by financing activities ....... (476,021) 1,086,088 2,019,015
---------- ---------- ----------
Net increase (decrease) in cash and cash equivalents ............... (111,974) (285,992) 239,354
Cash and cash equivalents at beginning of year ..................... 602,289 888,281 648,927
---------- ---------- ----------
Cash and cash equivalents at end of year ........................... $ 490,315 $ 602,289 $ 888,281
========== ========== ==========
</TABLE>
See Notes to Consolidated Financial Statements.
7
<PAGE>
J.W. MAYS, INC.
Notes to Consolidated Financial Statements
- --------------------------------------------------------------------------------
1. Summary of significant accounting policies:
CONSOLIDATION: The consolidated financial statements include the accounts
of the Company and its subsidiaries, which are wholly owned. Material
intercompany items have been eliminated in consolidation.
RENTAL INCOME: All of the real estate owned by the Company is held for
leasing to tenants except for a small portion used for Company offices. Rent is
to be recognized from tenants under executed leases no later than on an
established date or on an earlier date if the tenant should commence conducting
business. Unbilled receivables represent the excess of scheduled rental income
recognized on a straight-line basis over rental income as it becomes receivable
according to the provisions of the lease.
MARKETABLE SECURITIES--OTHER INVESTMENTS: Effective August 1, 1994, the
Company adopted Statement of Financial Accounting Standards No. 115, "Accounting
for Certain Investments in Debt and Equity Securities" ("FAS 115"). FAS 115
requires certain securities to be categorized as either trading, available for
sale or held to maturity. Trading securities are carried at fair value with
unrealized gains and losses included in income. Available for sale securities
are carried at fair value with unrealized gains and losses recorded as a
separate component of shareholders' equity. Held to maturity securities are
carried at amortized cost. Dividends and interest income are accrued as earned.
PROPERTY AND EQUIPMENT: Property and equipment are stated at cost.
Depreciation is calculated using the straight-line method and the declining
balance method. Amortization of improvements to leased property is calculated
over the shorter of the life of the lease or the estimated useful life of the
improvements. Lives used to determine depreciation and amortization are
generally as follows:
Building and improvements ................................. 18-40 years
Improvements to leased property ........................... 3-40 years
Fixtures and equipment .................................... 7-12 years
Other ..................................................... 3-5 years
Maintenance, repairs, renewals and improvements of a non-permanent nature are
charged to expense when incurred. Expenditures for additions and major renewals
or improvements are capitalized. The cost of assets sold or retired and the
accumulated depreciation or amortization thereon are eliminated from the
respective accounts in the year of disposal, and the resulting gain or loss is
credited or charged to income.
DEFERRED CHARGES: Deferred charges consist principally of costs incurred in
connection with the leasing of property to tenants. Such costs are amortized
over the related lease periods using the straight-line method.
INCOME TAXES: Effective August 1, 1993, the Company adopted Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes" ("FAS
109"). The adoption of FAS 109 changes the Company's method of accounting for
income taxes from the deferred method previously used under APB Opinion No. 11
to an asset and liability approach. This approach requires the recognition of
deferred tax assets and liabilities with respect to the expected future tax
consequences of events that have been recognized in the Company's financial
statements and income tax returns. As permitted by FAS 109, the Company has
elected not to restate prior years' consolidated financial statements.
INCOME (LOSS) PER SHARE OF COMMON STOCK: Income (loss) per share has been
computed by dividing net income or loss for the year by the weighted average
number of shares of common stock outstanding during the year, adjusted for the
purchase of treasury stock. Shares used in computing income or (loss) per share
were 2,136,397 in fiscal 1995, 2,137,440 in fiscal 1994 and 2,171,124 in fiscal
1993.
8
<PAGE>
- --------------------------------------------------------------------------------
2. Marketable Securities -- Other Investments:
As of July 31, 1995, the Company's marketable securities were classified as
follows:
<TABLE>
<CAPTION>
Gross Gross
Unrealized Unrealized Fair
Cost Gains Losses Value
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Current:
Available for sale
Equity securities ............................ $2,531,940 $42,010 $ -- $2,573,950
Certificate of deposit ....................... 25,804 -- -- 25,804
---------- ------- ---- ----------
Total ...................................... $2,557,744 $42,010 $ -- $2,599,754
Held to maturity:
Corporate debt securities due
within one year ............................ 199,958 3,372 -- 203,330
---------- ------- ---- ----------
Total current ............................ $2,757,702 $45,382 $ -- $2,803,084
========== ======= ==== ==========
Noncurrent:
Held to maturity:
Corporate debt securities .................. $ 164,063 $ 4,210 $ -- $ 168,273
========== ======= ==== ==========
</TABLE>
At July 31, 1994, marketable securities consisted of $120,010 of
certificates of deposit, $2,387,548 of debt securities and $2,289,220 of equity
securities, and the aggregate cost of debt and equity securities exceeded the
aggregate market value by $31,769.
Effective August 1, 1994, the Company adopted Statement of Financial
Accounting Standards No. 115, "Accounting for Certain Investments in Debt and
Equity Securities" ("FAS 115"). The impact of adopting FAS 115 was to increase
shareholders' equity, net of taxes, by $28,010 at July 31, 1995 representing
unrealized gain on available for sale securities, net of taxes. Gains from sales
of available for sale securities were $13,643. The cost of marketable securities
sold is determined by the specific identification method.
Investment income consists of the following:
1995 1994 1993
-------- -------- --------
Interest income .......................... $157,788 $239,951 $454,359
Dividend income .......................... 195,480 157,439 102,651
Gain on sale of securities ............... 13,643 18,924 5,437
Unrealized loss on marketable securities . -- (31,769) --
-------- -------- --------
Total .................................. $366,911 $384,545 $562,447
======== ======== ========
9
<PAGE>
- --------------------------------------------------------------------------------
3. Long-Term Debt--Mortgages Payable:
<TABLE>
<CAPTION>
July 31, 1995 July 31, 1994
Current ---------------------- ------------------------
Annual Final Due Due Due Due
Interest Payment Within After Within After
Rate Date One Year One Year One Year One Year
--------- -------- -------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Jowein Building, Brooklyn, N.Y. .... (a) 10 % 3/31/98 $ 53,513 $ 921,524 $ 48,480 $ 975,037
Fishkill, New York Property ........ (b) 9 % 11/01/99 99,333 2,670,079 299,802 2,769,413
Circleville, Ohio Property ......... (c) 7 % 9/30/02 245,053 2,153,714 228,532 2,398,767
Other .............................. 81/2% 5/01/01 6,914 208,989 6,353 215,902
-------- ---------- -------- ----------
Total .......................... $404,813 $5,954,306 $583,167 $6,359,119
======== ========== ======== ==========
</TABLE>
(a) Mortgage is held by an affiliated corporation owned by members,
including certain directors of the Company, of the family of the late Joe
Weinstein, former Chairman of the Board of Directors. Interest and amortization
of principal are paid quarterly. The mortgage was due to mature on March 31,
1996. On September 6, 1995 the maturity date of the mortgage was extended to
March 31, 1998. The interest rate of 10% will continue until March 31, 1996 and
from April 1, 1996 the interest rate will be established at a bank's prevailing
rate as at March 31, 1996. During the renewal period there will be no change in
the constant quarterly payments of interest and principal in the amount of
$37,263.
(b) On October 28, 1994, the existing first mortgage loan balance on the
Fishkill property was paid down by a $200,000 payment and the due date of the
mortgage loan was extended for a period of five years from November 1, 1994. The
annual interest rate was reduced from 10% to 9% and the principal and interest
payments are to be made in constant monthly amounts based upon a fifteen year
payout period.
(c) The mortgage loan, which is self-amortizing, matures September 30,
2002. The loan is payable at an annual interest rate of 7%. Under the terms of
the loan, constant monthly payments, including interest and principal, commenced
April 1, 1994 in the amount of $33,767, until October 1, 1997, at which time the
monthly payments of interest and principal increase to $36,540.
Maturities of long-term debt--mortgages payable, outstanding at July 31,
1995, are as follows: Years ending July 31, 1996 (included in current
liabilities), $404,813; 1997, $438,013; 1998, $1,299,721; 1999, $477,461; 2000,
$514,917, and thereafter, $3,224,194.
4. Long-Term Debt--Other:
Long-Term debt--Other consists of the following:
<TABLE>
<CAPTION>
1995 1994
-------- --------
<S> <C> <C>
Deferred compensation .............................................. $520,000* $520,000*
Lease security deposits ............................................ 157,597** 152,038**
-------- --------
Total .......................................................... $677,597 $672,038
======== ========
</TABLE>
Maturities of long-term debt--other, outstanding at July 31, 1995, are as
follows: Years ending July 31, 1996, $711; 1997, $60,667; 1998, $104,000; 1999,
$111,752; 2000, $201,555 and thereafter, $198,912.
- -------------
* In fiscal 1964 the Company entered into a deferred compensation agreement
with its then Chairman of the Board. This agreement, as amended, provides for
the $520,000 to be paid in monthly installments of $8,666.67 for a period of
60 months, payable upon the expiration of his employment, retirement or
permanent disability as defined in the agreement, or death.
** Does not include two irrevocable letters of credit totaling $370,000 provided
by two tenants as lease security deposits.
10
<PAGE>
5. Income Taxes:
Effective August 1, 1993, the Company adopted Statement of Financial
Accounting Standards No. 109--Accounting for Income Taxes ("FAS 109").
The adoption of FAS 109 resulted in a cumulative adjustment which decreased
the earnings for the fiscal 1994 first quarter and the year ended July 31, 1994
by $275,000. Significant components of the Company's deferred tax assets and
liabilities as of July 31, 1995 and 1994, are a result of temporary differences
related to the items described as follows:
<TABLE>
<CAPTION>
1995 1994
------------------------------- -----------------------------
Deferred Deferred Deferred Deferred
Tax Assets Tax Liabilities Tax Assets Tax Liabilities
----------- --------------- ----------- ---------------
<S> <C> <C> <C> <C>
Net operating loss carryforward ...................... $1,994,301 $ -- $1,520,001 $ --
Alternative minimum tax credit carryforward .......... 246,369 -- 246,369 --
Investment tax credit carryforward ................... 117,098 -- 169,698 --
Deferred compensation not currently deductible ....... 176,800 -- 176,800 --
Rental income received in advance .................... 18,274 -- 23,354 --
Unrealized losses on marketable securities ........... -- -- 10,801 --
Bad debts ............................................ 44,138 -- 29,461 --
Unbilled receivables ................................. -- 1,368,988 -- 1,129,459
Property and equipment ............................... -- 1,093,241 -- 1,096,609
Unrealized gain on available for sale securities ..... -- 14,000 -- --
Other ................................................ 10,118 771 6,214 932
---------- ---------- ---------- ----------
2,607,098 2,477,000 2,182,698 2,227,000
Valuation allowance .................................. 117,098 -- 169,698 --
---------- ---------- ---------- ----------
$2,490,000 $2,477,000 $2,013,000 $2,227,000
========== ========== ========== ==========
</TABLE>
The Company has determined, based on its history of operating earnings and
expectations for the future, that it is more likely than not that future taxable
income will be sufficient to fully utilize the deferred tax assets at July 31,
1995, except for investment tax credit carryforwards, for which a 100% valuation
allowance has been provided.
Income taxes provided (benefit) in fiscal 1995, 1994 and 1993 consisted of:
<TABLE>
<CAPTION>
1995 1994 1993
--------- -------- --------
<S> <C> <C> <C>
Current:
Federal ........................................ $ -- $ -- $ 24,000
State and City ................................. 125,000 129,000 139,000
Deferred taxes ................................... (251,000) (61,000) --
Charge equivalent to the income tax benefit
of operating loss carryforward utilized ........ -- -- 709,000
--------- -------- --------
Total provision or (benefit) ................. $(126,000) $ 68,000 $872,000
========= ======== ========
</TABLE>
Components of the deferred tax provision (benefit) for the years ended July
31, 1995 and 1994 are as follows:
1995 1994
--------- ---------
Excess of book depreciation over tax depreciation .. $ (3,000) $ (4,000)
Reduction of rental income received in advance ..... 5,000 46,000
Increase in unbilled receivables ................... 240,000 2,000
Unrealized gain (loss) on marketable securities .... 14,000 (11,000)
Net operating loss carryforwards ................... (474,000) (59,000)
Bad debts .......................................... (15,000) (29,000)
Other .............................................. (18,000) (6,000)
--------- ---------
$(251,000) $(61,000)
========= =========
11
<PAGE>
- --------------------------------------------------------------------------------
Taxes provided (benefit) for the years ended July 31, 1995, 1994 and 1993
differ from amounts which would result from applying the federal statutory tax
rate to pre-tax income (loss), as follows:
1995 1994 1993
--------- -------- ----------
Income (loss) from operations before
income taxes ...................... $(519,808) $ 35,534 $2,335,930
Dividends received deduction ....... (96,442) (79,702) (71,856)
Other-net .......................... 3,015 (5,832) 30,044
--------- -------- ----------
Adjusted pre-tax income (loss) ..... $(613,235) $(50,000) $2,294,118
Statutory rate ..................... 34% 34% 34%
--------- -------- ----------
Income tax provision (benefit) at
statutory rate .................... $(208,500) $(17,000) $ 780,000
State and City income taxes, net of
federal income tax benefit ........ 82,500 85,000 92,000
--------- -------- ----------
Income taxes provided (benefit) .... $(126,000) $ 68,000 $ 872,000
========= ======== ==========
As a result of the Tax Reform Act of 1986, a separate parallel tax system,
Alternative Minimum Tax ("AMT"), was created. AMT is calculated separately from
the regular Federal income tax and is based on a flat rate applied to a base
which is broader than the regular tax base. The higher of the two taxes is paid.
The excess of the AMT over regular tax is a tax credit, which can be carried
forward indefinitely to reduce regular tax liabilities of future years. The
Company was subject to AMT in 1993 and 1989 in the amounts of $23,000 and
$230,000, respectively.
At July 31, 1995, the Company had tax net operating loss carryforwards of
$5,865,000 available to offset future regular taxable income. Of this amount
$1,210,000 is available until the year 2003, $2,057,000 until 2005, $1,028,000
until 2006, $175,000 until 2009 and $1,395,000 in 2010.
Although the Tax Reform Act of 1986 eliminated investment tax credit for
non-transitional property placed in service after December 31, 1985, the Company
has investment tax credit carryforwards of $117,000 that expire as follows:
$75,000 in 1996, $15,000 in 1997, $2,000 in 1998, $16,000 in 1999 and $9,000 in
2000.
6. Leases:
The Company's real estate operations encompass both owned and leased
properties. The current leases on leased property, most of which have options to
extend the term, range from 2 years to 21 years. Certain of the leases provide
for additional rentals under certain circumstances and obligate the Company for
payments of real estate taxes and other expenses.
Rental expense for non-capitalized real and personal property for the three
fiscal years ended July 31, 1995 was exceeded by sublease rental income, as
follows:
1995 1994 1993
---------- ---------- ----------
Minimum rental expense ......... $1,133,896 $1,113,872 $1,108,779
Contingent rental expense ...... 1,278,773 1,267,918 1,246,677
---------- ---------- ----------
2,412,669 2,381,790 2,355,456
Sublease rental income ......... 3,540,588 3,934,133 3,975,350
---------- ---------- ----------
Excess ..................... $1,127,919 $1,552,343 $1,619,894
========== ========== ==========
Rent payments for operating leases include $141,300 for fiscal 1995 and
$121,800 for each of the fiscal years 1994 and 1993, representing rentals with
affiliated companies.
12
<PAGE>
- --------------------------------------------------------------------------------
Future minimum non-cancellable rental commitments for operating leases with
initial or remaining terms of one year or more are payable as follows:
Fiscal Operating
Year Leases
------ -----------
1996 .................................................... $ 1,143,340
1997 .................................................... 1,143,340
1998 .................................................... 1,143,340
1999 .................................................... 1,143,340
2000 .................................................... 1,143,340
After 2000 .............................................. 9,750,547
-----------
Total required* ..................................... $15,467,247
===========
* Minimum payments have not been reduced by minimum sublease rentals of
$38,725,499 under operating leases due in the future under non-cancellable
leases.
7. Rental Income:
Rental income from Company owned property includes $385,720 per annum for
the year 1995 and $415,934 for the years 1994 and 1993 representing rentals from
an affiliated company.
Amounts due from the affiliated Company included in unbilled receivables
and noncurrent receivables are as follows:
<TABLE>
<CAPTION>
July 31,
------------------------------------
1995 1994 1993
---------- ---------- ----------
<S> <C> <C> <C>
Unbilled receivables ................................................................ $ 999,344 $1,025,578 $1,068,082
Receivables-noncurrent .............................................................. 109,687 109,687 --
-current ................................................................. -- -- 42,656
---------- ---------- ----------
Total ........................................................................... $1,109,031 $1,135,265 $1,110,738
========== ========== ==========
</TABLE>
Rental income for the years 1995, 1994 and 1993 is as follows:
<TABLE>
<CAPTION>
July 31,
--------------------------------------
1995 1994 1993
---------- ---------- -----------
<S> <C> <C> <C>
Minimum rentals
Company owned property ......................................................... $4,254,489 $4,816,853 $ 5,124,152
Operating leases ............................................................... 2,955,906 3,265,820 3,258,051
---------- ---------- -----------
7,210,395 8,082,673 8,382,203
---------- ---------- -----------
Contingent rentals
Company owned property ......................................................... 535,105 771,542 929,941
Operating leases ............................................................... 584,682 668,313 717,300
---------- ---------- -----------
1,119,787 1,439,855 1,647,241
---------- ---------- -----------
Total ........................................................................ $8,330,182 $9,522,528 $10,029,444
========== ========== ===========
</TABLE>
Future minimum non-cancellable rental income for leases with initial or
remaining terms of one year or more is as follows:
<TABLE>
<CAPTION>
Fiscal Company Operating
Year Owned Property Leases Total
---- -------------- ----------- -----------
<S> <C> <C> <C>
1996 .......................................... $ 4,670,942 $ 3,461,787 $ 8,132,729
1997 .......................................... 4,466,624 3,338,597 7,805,221
1998 .......................................... 4,084,051 2,956,025 7,040,076
1999 .......................................... 3,938,209 2,837,077 6,775,286
2000 .......................................... 3,828,159 2,835,337 6,663,496
After 2000 .................................... 27,711,816 23,296,676 51,008,492
----------- ----------- -----------
Total ..................................... $48,699,801 $38,725,499 $87,425,300
=========== =========== ===========
</TABLE>
13
<PAGE>
- --------------------------------------------------------------------------------
8. Payroll and other accrued liabilities:
Payroll and other accrued liabilities consist of the following:
1995 1994
-------- --------
Payroll ................................ $114,290 $102,119
Interest ............................... 98,031 104,312
Professional fees ...................... 86,996 120,032
Rents received in advance .............. 53,749 68,688
Utilities .............................. 83,036 68,051
Insurance premiums ..................... 5,304 465
Construction costs ..................... 2,025 66,220
Other .................................. 44,525 35,957
-------- --------
Total ............................. $487,956 $565,844
======== ========
9. Payable to Securities Broker:
The Company borrowed funds, payable on demand, from a securities broker.
The loan balance at July 31, 1995 in the amount of $1,225,100, secured by the
Company's marketable securities, accrues interest, which at July 31, 1995, was
at the annual rate of 81 1/4%.
10. Employees' Retirement Plan:
The Company sponsors a noncontributory Money Purchase Plan covering
substantially all of its employees. Operations were charged $137,474, $125,750,
and $71,288 as contributions to the Plan for fiscal 1995, 1994 and 1993,
respectively.
11. Financial instruments and credit risk concentrations:
Financial instruments that are potentially subject to concentrations of
credit risk consist principally of marketable securities--other investments,
cash equivalents and receivables. Marketable securities--other investments and
cash equivalents are placed with high credit quality financial institutions and
instruments to minimize risk.
The Company derives rental income from twenty-three tenants, of which three
tenants each accounted for more than 10% of rental income during the year end as
of July 31, 1995. The City of New York is one of the three tenants and the other
two tenants are 510 Fulton Street Realty Association and its related 168-21
Jamaica Avenue Store Corporation, the owners of which are long established in
business.
McCrory Stores Corporation ("McCrory"), which occupied space in the Fulton
Mall in downtown Brooklyn, New York, and whose lease extended to April 29, 2010
and accounted for approximately 14% of the 1993 annual rental income of the
Company, filed for Chapter 11 bankruptcy protection from creditors on February
26, 1992. McCrory made application to the United States Bankruptcy Court for
authorization to reject the lease agreement, as amended, between the Company, as
landlord, and McCrory, as tenant, effective as of January 31, 1994. The United
States Bankruptcy Court authorized McCrory to reject such lease agreement
effective January 31, 1994 by order signed on January 21, 1994. The Company has
filed a Proof of Claim with the United States Bankruptcy Court, Southern
District of New York in the total amount of $7,753,732 which amount includes
$7,667,082 for damages arising from the rejection of the lease and $86,650 for
pre-petition rental obligations. The Company has not included this claim in its
financial statements due to the uncertainty of the ultimate court determined
amount. McCrory has not as yet filed a Plan of Reorganization with the
Bankruptcy Court. The Company has leased 50,000 square feet of the 99,000 square
feet of space surrendered by McCrory.
Jamesway Corporation, which occupies retail space in the Fishkill, New York
property and accounts for approximately 6% of the annual rental income of the
Company, filed for Chapter 11 bankruptcy protection from creditors on July 19,
1993. On December 22, 1993, conditioned upon Jamesway not rejecting the lease,
the Company granted Jamesway a $250,000 cumulative reduction of the fixed rent
for the period between February 1, 1994 and January 31, 1997. On December 8,
1994, as an additional inducement for Jamesway to assume the lease, the lease
was further modified by reducing the original expiration date of the lease from
January 31, 2009 to January 31, 2005, granting Jamesway a four-year option
period to expire January 31, 2009 at an increased rental during such extension
period and requiring the payment of the amount of $26,211 to cure its monetary
14
<PAGE>
- --------------------------------------------------------------------------------
default. On December 29, 1994 an order was signed by the Judge of the United
States Bankruptcy Court, Southern District of New York approving the assumption
of the modified lease by Jamesway and ordering Jamesway to cure its monetary
default in the amount of $26,211 by paying such amount in cash within ten (10)
days from the entry of the Order. The amount has been paid. Jamesway emerged
from bankruptcy on January 28, 1995. Of the $250,000 cumulative reduction in the
fixed rent, Jamesway applied $75,000 through July 31, 1994, $125,000 for fiscal
1995 and the balance of $50,000 will be applied through January 31, 1997.
The Company in 1991 changed its method of recognizing rental income
revenues under lease arrangements to comply with the provisions of Statement of
Financial Accounting Standards No. 13, "Accounting for Leases", and since 1991
includes scheduled minimum lease payments in income on a straight-line basis.
Consequently, of the above $250,000 cumulative reduction in the fixed rent,
$53,192 has been reflected as a reduction of rental income through July 31,
1994, $23,022 has been reflected for the fiscal year ended July 31, 1995 and the
balance of $173,786 will be reflected as a reduction of rental income
thereafter.
The lease with IBM, a tenant in Fishkill, New York, expired on March 31,
1994. The IBM lease previously accounted for approximately 8% of the annual
rental income of the Company. The Company has leased 25,000 square feet of the
100,000 square feet of space vacated
12. Cash flow information:
For purposes of reporting cash flows, the Company considers cash
equivalents to consist of short-term highly liquid investments with maturities
of three months or less, which are readily convertible into cash.
Supplemental disclosure:
Years Ended July 31,
------------------------------------
1995 1994 1993
-------- -------- --------
Interest paid ................ $647,348 $623,222 $567,236
Income taxes paid ............ $ 84,407 $180,903 $139,715
13. Financial Accounting Standards No. 121:
In May 1995, the Financial Accounting Standards Board issued Statement of
Financial Standards No. 121 ("FAS 121"), "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of", effective for
fiscal years beginning after December 15, 1995. FAS 121 requires the recognition
of an impairment loss related to long-lived assets and certain identifiable
intangibles whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. The Company believes that
the adoption of the new accounting standard will not have any effect on the
consolidated financial statements.
14. Settlement of Condemnation of Company Property:
The City of New York (the "City"), by condemnation for the Metro Tech Urban
Renewal Area, took title in fiscal year 1989 to the Company's garage at 160
Duffield Street, its warehouse at 366-372 Gold Street, its vacant lot at 185-87
Duffield Street and its parking lot at 125 Willoughby Street, all in Brooklyn.
The Company contested as inadequate the amounts received from the City as
consideration for the properties.
In the quarter ended January 31, 1993, a settlement was reached with the
City and accepted by the Court which increased the amount of the award from
$2,862,000 to $3,600,000, plus interest at the rate of 6% per annum from the
date that the City took title to each of the properties to the date of payment.
The pre-tax gain, less applicable expenses, of $639,048 on the additional award
plus interest income of $116,365, had been reflected in the 1993 Consolidated
Financial Statements.
15
<PAGE>
- --------------------------------------------------------------------------------
15. Commitments and Contingencies:
There are various lawsuits and claims pending against the Company. It is
the opinion of management that the resolution of these matters will not have a
material adverse effect on the Company's Consolidated Financial Statements.
The construction in progress relating to the Jowein Building will be
completed in October 1995 at an additional cost of approximately $800,000 using
the proceeds of the loan facility discussed in Note 16 to the Consolidated
Financial Statements.
16. Subsequent Events:
(a) On August 17, 1995 the Company entered into an agreement with a bank
wherein the bank approved a $1,500,000 loan facility for the Company to use to
fund building construction/renovation costs to accommodate tenants under lease.
The overall term of the facility is five years with a one year line of credit,
to be taken down as needed. The initial twelve month period is to be on an
interest only basis, payable monthly, with the principal balance outstanding to
be converted to a four year fully amortizing term loan, payable with monthly
payments to be first applied to the payment of interest, and second, to the
payment of the principal indebtedness. The interest rate for advances under the
line and the term loan will be the bank's prime rate of interest on a floating
basis. The leases between the Company and two of its tenants in the Brooklyn
(Jowein Building) renovated area have been assigned to the bank as collateral
for the loan. There is no prepayment penalty for early payoff of the loan. The
Company has taken down $400,000 as of the date of this report.
(b) Jamesway Corporation, which occupies retail space in the Fishkill, New
York property and is expected to account for approximately 5.2% of the annual
rental income of the Company for the fiscal year ending July 31, 1996, filed
for Chapter 11 bankruptcy protection from creditors on October 18, 1995.
Jamesway has not expressed its intentions relating to such property and the
Company is unable to determine the effect, if any, of such filing on its
operations.
- --------------------------------------------------------------------------------
Report of Independent Accountants
The Board of Directors
J.W. MAYS, INC.
We have audited the accompanying consolidated balance sheets of J.W. Mays,
Inc. and its subsidiaries as of July 31, 1995 and 1994 and the related
consolidated statements of operations and retained earnings, and cash flows for
each of the years in the three-year period ended July 31, 1995. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. 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 audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of J.W. Mays,
Inc. and its subsidiaries as at July 31, 1995 and 1994 and the results of their
operations and their cash flows for each of the years in the three-year period
ended July 31, 1995, in conformity with generally accepted accounting
principles.
As described in Note 1 to the consolidated financial statements, on August
1, 1994, the Company changed its method of accounting for marketable
securities--other investments, and on August 1, 1993, the Company changed its
method of accounting for income taxes.
LIPSKY, GOODKIN & CO., P.C.
New York, New York
October 12, 1995 (except with respect to
the matter discussed in Note 16(b), as
to which the date is October 20, 1995)
16
<PAGE>
J.W. MAYS, INC.
Five Year Summary of Consolidated Operations
(dollars in thousands except per share data)
<TABLE>
<CAPTION>
Years Ended July 31,
--------------------------------------------------------------------
1995 1994 1993 1992 1991
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Revenues
Rental income ..................................... $ 8,330 $ 9,523 $ 10,030 $ 9,299 $ 8,178
Gain on sale of property and equipment ............ -- -- 1 -- 3
Gain on condemnation award ........................ -- -- 639 -- --
---------- ---------- --------- ---------- ---------
Total revenues .............................. 8,330 9,523 10,670 9,299 8,181
---------- ---------- --------- ---------- ---------
Expenses
Real estate operating expenses .................... 5,580 5,612 5,509 5,311 5,407
Administrative and general expenses ............... 2,158 2,840 2,075 2,105 2,310
Depreciation and amortization ..................... 838 823 748 669 592
---------- ---------- --------- ---------- ---------
Total expenses .............................. 8,576 9,275 8,332 8,085 8,309
---------- ---------- --------- ---------- ---------
Income (loss) from continuing operations before
investment income, interest expense and
income taxes ...................................... (246) 248 2,338 1,214 (128)
---------- ---------- --------- ---------- ---------
Investment income and interest expense
Investment income ................................. 367 385 562 678 825
Interest expense .................................. 641 597 564 471 482
---------- ---------- --------- ---------- ---------
(274) (212) (2) 207 343
---------- ---------- --------- ---------- ---------
Income (loss) from continuing operations before
income taxes ...................................... (520) 36 2,336 1,421 215
Income taxes (benefit) .............................. (126) 68 872 565 120
---------- ---------- --------- ---------- ---------
Income (loss) from continuing operations ............ (394) (32) 1,464 856 95
---------- ---------- --------- ---------- ---------
Discontinued Operations
(Loss) from disposal of retail segment--net
of taxes ........................................ -- -- -- (47) (319)
---------- ---------- --------- ---------- ---------
Total (loss) from discontinued operations ... -- -- -- (47) (319)
---------- ---------- --------- ---------- ---------
Income (loss) from operations before extraordinary
item and cumulative effect of changes in
accounting principles ............................. (394) (32) 1,464 809 (224)
Accounting for certain investments in debt
and equity securities ......................... 22 -- -- -- --
Accounting for income taxes ..................... -- (275) -- -- --
Extraordinary Item--utilization of net operating
loss carryforward ................................. -- -- 709 416 --
--------- --------- --------- --------- ----------
Net Income (loss) ................................... $ (372) $ (307) $ 2,173 $ 1,225 $ (224)
========= ========= ========= ========= ==========
Income (loss) per common share
Income (loss) from continuing operations .......... $ (.18) $ (.02) $ .67 $ .39 $ .04
(Loss) from discontinued operations -- -- -- (.02) (.14)
Cumulative effect of change in accounting principles:
Accounting for certain investments in debt
and equity securities ........................... .01 -- -- -- --
Accounting for income taxes ....................... -- (.13) -- -- --
Extraordinary item--utilization of net operating
loss carryforward -- -- .33 .19 --
--------- --------- --------- --------- ----------
Net income (loss) per common share ............ $ (.17) $ (.15) $ 1.00 $ .56 $ (.10)
========= ========= ========= ========= ==========
Dividends per share ................................. -- -- -- -- --
========= ========= ========= ========= ==========
Average common shares outstanding ................... 2,136,397 2,137,440 2,171,124 2,178,297 2,178,297
========= ========= ========= ========= ==========
</TABLE>
See Notes to Consolidated Financial Statements
17
<PAGE>
J.W. MAYS, INC.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
- --------------------------------------------------------------------------------
Fiscal 1995 Compared to Fiscal 1994
Operations for the fiscal year ended July 31, 1995 resulted in an after tax
net loss of $393,808, or $.18 per share, compared to an after tax net loss of
$32,466, or $.02 per share, after the write-off of a bad debt amounting to
$708,673, discussed below, in the 1994 fiscal year.
The excess of the scheduled rental income of McCrory, recognized on a
straight-line basis over rental income reported through January 31, 1994, the
effective date of McCrory's rejection of its lease, amounted to $622,023 which,
together with the pre-petition claim of $86,650, were written off as a bad debt
and reported as an administrative expense in fiscal 1994.
In the twelve months ended July 31, 1995, the Company reported an overall
net loss in the amount of $372,039, or $.17 per share, after the cumulative
effect (an increase of income) of a change in accounting for certain investments
in debt and equity securities, in the amount of $21,769, or $.01 per share.
There was no comparable item in the 1994 fiscal year. The overall net loss for
the 1994 twelve month period amounted to $307,466, or $.15 per share, after a
charge for the cumulative effect of a change in accounting for income taxes of
$275,000, or $.13 per share. There was no comparable item in the 1995 fiscal
year.
Rental income in the current year decreased to $8,330,182 from $9,522,528
in the 1994 twelve months, primarily due to the loss of two tenants and the
concession of rent for another tenant (See Note 11 to the Consolidated Financial
Statements), partially offset by rental income from a new tenant.
Real estate operating expenses decreased to $5,580,161 in the current year
from $5,611,835 in the 1994 twelve months principally due to decreased real
estate taxes, maintenance costs, and fuel, partially offset by an increase in
insurance expense and electricity.
Administrative and general expenses decreased to $2,157,610 in the 1995
fiscal year from $2,840,030 in the 1994 twelve month period, principally due to
the recording of the bad debt in 1994 discussed above, and a reduction of legal
and professional expenses.
Depreciation and amortization expense in the current year increased to
$838,063 from $822,727 in the 1994 twelve month period because of additional
improvements to property.
Interest expense exceeded investment income by $274,156 in the current year
and by $212,402 in the twelve months ended July 31, 1994 primarily due to the
increased interest on the broker loan discussed in Note 9 to the Consolidated
Financial Statements.
Fiscal 1994 Compared to Fiscal 1993
For the twelve months ended July 31, 1994 the Company had a net loss of
$307,466, or $.15 per share, consisting of a loss from operations of $32,466, or
$.02 per share, and the cumulative effect of a change in accounting for income
taxes of $275,000, or $.13 per share. The operating loss resulted after the
write-off of a bad debt amounting to $708,673 referred to below. The Company
reports scheduled rental income recognized on a straight-line basis rather than
rental income as it becomes a receivable according to the provisions of the
lease, in compliance with the provisions of Statement of Financial Accounting
Standards No. 13, "Accounting for Leases". The excess of the scheduled rental
income of McCrory, recognized on a straight-line basis over rental income
reported through January 31, 1994, the effective date of McCrory's rejection of
its lease, amounted to $622,023, which, together with the pre-petition claim of
$86,650 were written off and classified as a bad debt.
In the comparable 1993 twelve month period, income from operations
including a gain on a condemnation award, less applicable expenses, of $639,048
(See Note 14 to the Consolidated Financial Statements), amounted to $1,463,930,
or $.67 per share, while the overall net income amounted to $2,172,930, or $1.00
per share, after an extraordinary credit of $709,000, or $.33 per share, arising
from the utilization of a net operating loss carryforward.
Rental income for the 1994 fiscal year decreased to $9,522,528 from
$10,029,444 in the 1993 fiscal year, principally due to the loss of two tenants
and a concession of rent for another tenant (See Note 11 to the Consolidated
Financial Statements), partially offset by rental income from property purchased
in December, 1992 in Ohio and a settlement of a claim against a tenant.
18
<PAGE>
- --------------------------------------------------------------------------------
Real estate operating expenses increased by $103,295 principally due to an
increase in insurance expense of $20,221, maintenance expense of $102,286,
electricity of $26,903 and fuel, water and sewage of $20,179, partially offset
by a decrease in real estate taxes of $39,579.
Administrative and general expenses increased to $2,840,030 from $2,074,774
principally due to the bad debt of $708,673 discussed above, an increase in
legal and professional expense of $44,270 which amount includes legal expenses
incurred in settling a claim against a tenant which resulted in the additional
rent received referred to above and pension expense of $48,336 partially offset
by a write-off of a 1993 nonrecurring bad debt amounting to $22,285 relating to
a tenant vacating certain premises.
Investment income decreased to $384,545 from $562,447 in the earlier year,
principally due to the use of funds to acquire the property in Circleville, Ohio
on December 23, 1992, generally lower interest rates on investments and the use
of funds for operations. The 1993 figures include interest income of $116,365 on
the condemnation award discussed above. There is no comparable item in the 1994
year.
Interest expense increased to $596,947 from $564,649 in 1993 because of the
financing of the Ohio property described in Note 3(c) to the Consolidated
Financial Statements, partially offset by a reduction of long-term debt.
Liquidity and Capital Resources
The Company has been operating as a real estate enterprise since the
discontinuance of the retail department store segment of its operations on
January 3, 1989.
The leasing of 50,000 square feet of space in the Jowein Building located
in the Fulton Mall in downtown Brooklyn, New York to two chain store tenants for
retail space and the leasing of 25,000 square feet to the U.S. Post Office in
Fishkill, New York will provide additional working capital for the Company. The
term of the Brooklyn leases will commence in November, 1995 and the term of the
Fishkill lease will commence in December, 1995. (See Note 11 to Consolidated
Financial Statements).
Negotiations are in progress to lease available office and retail space of
approximately 645,000 square feet in the Company's buildings in Brooklyn,
Jamaica and Fishkill, New York. The Company is confident that the rate at which
space is leased will accelerate, resulting in an increase in rental income and
improvement in cash flow and net income.
On August 17, 1995 the Company entered into an agreement with a bank
wherein the bank approved a $1,500,000 loan facility for the Company to use to
fund building construction/renovation costs to accommodate tenants under lease.
The Company has taken down $400,000 as of the date of this report. (See Note 16
to Consolidated Financial Statements).
To further improve the Company's cash position, on October 28, 1994, the
existing first mortgage loan balance on the Fishkill property was paid down by a
$200,000 payment and the due date of the mortgage loan was extended for a period
of five years to mature November 1, 1999. The annual interest rate was reduced
from 10% to 9% and the principal payments are made in constant monthly amounts
based upon a fifteen year payout period.
The Company had working capital of $2,478,431 with a ratio of current
assets to current liabilities of 2.1 to 1 at July 31, 1995.
Management considers current working capital and borrowing capabilities
adequate to cover the Company's planned operating and capital requirements.
19
<PAGE>
J.W. MAYS, INC.
- --------------------------------------------------------------------------------
Quarterly Financial Information (Unaudited)
(dollars in thousands except per share data)
<TABLE>
<CAPTION>
Three months ended
-----------------------------------------------------------
Oct. 31, 1994 Jan. 31, 1995 Apr. 30, 1995 July 31, 1995
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues ..................................................... $2,071 $2,109 $2,097 $2,053
Revenues less expenses ....................................... (78) (60) (151) (231)
(Loss) from operations ....................................... (57) (53) (111) (173)
Cumulative effect of change in accounting for
certain investments in debt and equity securities .......... 22 -- -- --
Net (loss) ................................................... (35) (53) (111) (173)
(Loss) per common share:
From operations ............................................ $ (.03) $ (.02) $ (.05) $ (.08)
Cumulative effect of change in accounting for
certain investments in debt and equity securities ........ .01 -- -- --
------ ------ ------ ------
Net (loss) per common share ................................. $ (.02) $ (.02) $ (.05) $ (.08)
====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Three months ended
-----------------------------------------------------------
Oct. 31, 1993 Jan. 31, 1994 Apr. 30, 1994 July 31, 1994
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues ..................................................... $2,573 $2,515 $2,161 $2,274
Revenues less expenses ....................................... 477 (244) (126) (71)
Income (loss) from operations ................................ 206 (120) (95) (23)
Cumulative effect of change in accounting for
income taxes ............................................... (275) -- -- --
Net (loss) ................................................... (69) (120) (95) (23)
Income (loss) per common share:
From operations ............................................ $ .10 $ (.06) $ (.04) $ (.02)
Cumulative effect of change in accounting for
income taxes ............................................. (.13) -- -- --
------ ------ ------ ------
Net (loss) per common share ................................ $ (.03) $ (.06) $ (.04) $ (.02)
====== ====== ====== ======
</TABLE>
- ------------------
Income (loss) per share is computed independently for each of the quarters
presented, on the basis described in Note 1 to the Consolidated Financial
Statements.
Common Stock Prices and Dividends
The Company's common stock trades on The Nasdaq Stock Market under the
symbol: "Mays".
Following is the sales price range per share of J.W. Mays, Inc. common
stock during the fiscal years ended July 31, 1995 and 1994:
Sales Price
-----------------
Three months ended High Low
- ------------------ ----- -----
October 31, 1994 ........................................... 7-3/8 6-3/4
January 31, 1995 ........................................... 7-1/2 6-1/2
April 30, 1995 ............................................. 7 5-1/2
July 31, 1995 .............................................. 7-1/2 5-1/2
October 31, 1993 ........................................... 7-1/4 5-1/2
January 31, 1994 ........................................... 7-1/2 6-1/4
April 30, 1994 ............................................. 7-1/4 6-1/4
July 31, 1994 .............................................. 7-3/4 6-1/2
The quotations were obtained for the respective periods from the National
Association of Securities Dealers, Inc.
There were no dividends declared in either of the two fiscal years.
On September 29, 1995, the Company had approximately 3,700 shareholders of
record.
20
<PAGE>
J.W. MAYS, INC.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
Officers
<S> <C>
Lloyd J. Shulman Co-Chairman of the Board, Chief Executive Officer and
President and Chief Operating Officer
Alex Slobodin Executive Vice President and Treasurer
Ward N. Lyke, Jr. Vice President--Management Information Services
George Silva Vice President--Operations
Salvatore Cappuzzo Secretary
Mark Greenblatt Controller and Assistant Treasurer
Board of Directors
Frank J. Angell 1,2,3,5 Professor Emeritus, New York University College of Business
and Public Administration
Jack Schwartz 2,3,4,5 Private Consultant
Lloyd J. Shulman 1,3,4,5 Co-Chairman of the Board, Chief Executive Officer and
President and Chief Operating Officer, J.W. Mays, Inc.
Max L. Shulman 1,3,4,5 Co-Chairman of the Board, J.W. Mays, Inc.
Sylvia W. Shulman Retired Fashion Director and Merchandiser of Boutique Shops,
J.W. Mays, Inc.
Lewis D. Siegel 2,3,5 Vice President, Smith Barney, Inc.
Alex Slobodin 1,3 Executive Vice President and Treasurer, J.W. Mays, Inc.
</TABLE>
Committee Assignments Key:
1 Member of Executive Committee
2 Member of Audit Committee
3 Member of Investment Advisory Committee
4 Member of Advisory Real Estate Committee
5 Member of Executive Compensation Committee
Annual Report on Form 10-K
The Company's Annual Report on Form 10-K,
filed with the Securities and Exchange Commission
for the fiscal year ended July 31, 1995,
will be furnished without charge to
shareholders upon written request
to: Secretary, J.W. Mays, Inc.,
9 Bond Street, Brooklyn, New York 11201.
21
C-3
EXHIBIT 21
Subsidiaries of the Registrant
The Registrant owns all of the outstanding stock of the following
corporations, which are included in the Consolidated Financial Statements filed
with this report.
Dutchess Mall Sewage Plant, Inc.
(a New York corporation)
J.W.M. Realty Corp.
(an Ohio corporation)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the Annual
Report for the year ended July 31, 1995 and is qualified in its entirety by
reference to such Annual Report.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JUL-31-1995
<PERIOD-START> AUG-01-1994
<PERIOD-END> JUL-31-1995
<CASH> 490,315
<SECURITIES> 2,799,712
<RECEIVABLES> 244,992
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 4,683,713
<PP&E> 44,126,170
<DEPRECIATION> 18,840,235
<TOTAL-ASSETS> 36,144,303
<CURRENT-LIABILITIES> 2,205,282
<BONDS> 0
<COMMON> 2,178,297
0
0
<OTHER-SE> 25,114,821
<TOTAL-LIABILITY-AND-EQUITY> 36,144,303
<SALES> 0
<TOTAL-REVENUES> 8,330,182
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 8,575,834
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 641,067
<INCOME-PRETAX> (519,808)
<INCOME-TAX> (126,000)
<INCOME-CONTINUING> (393,808)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 21,769
<NET-INCOME> (372,039)
<EPS-PRIMARY> (0.17)
<EPS-DILUTED> .00
</TABLE>
