THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATIONS S-T
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Period Ended: May 31, 1995 Commission File Number: 1-6833
MGI PROPERTIES
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 04-6268740
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporationor organization)
30 Rowes Wharf, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 330-5335
N/A
Former name, former address and former fiscal year,
if changed since last report.
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
Common shares outstanding as of July 12, 1995: 11,489,438
Page 1 of 14 pages
Exhibit Index appears on Page 13
<PAGE>
MGI PROPERTIES
INDEX
PART I: FINANCIAL INFORMATION Page No.
Item 1: Financial Statements
Consolidated Balance Sheets 3
Consolidated Statements of Earnings 4
Consolidated Statements of Cash Flow 5
Consolidated Statements of Changes in Shareholders' Equity 6
Notes to Consolidated Financial Statements 7
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II: OTHER INFORMATION
Items 1 - 6 11
Exhibit A: Computation of Earnings Per Share 12
Exhibit B: Amendments to Declaration of Trust 13
Signatures 14
- 2 -
<PAGE>
MGI PROPERTIES
PART I -- FINANCIAL INFORMATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
May 31, 1995 November 30, 1994
(unaudited)
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Real estate, at cost $279,783,000 $267,530,000
Accumulated depreciation and amortization (35,646,000) (32,029,000)
- --------------------------------------------------------------------------------------------------
Net investments in real estate 244,137,000 235,501,000
Cash 2,021,000 1,774,000
Short-term investments, at cost 2,922,000 11,118,000
U.S. Government securities, at cost 607,000 629,000
Other assets 8,718,000 7,013,000
- --------------------------------------------------------------------------------------------------
$258,405,000 $256,035,000
==================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Mortgage and other loans payable $ 71,249,000 $ 70,954,000
Other liabilities 5,195,000 5,286,000
- --------------------------------------------------------------------------------------------------
Total liabilities 76,444,000 76,240,000
Deferred gain -- real estate 3,700,000 3,700,000
Shareholders' equity:
Preferred shares -- $1 par value; 6,000,000 shares authorized;
none issued -- --
Common shares -- $1 par value; 17,500,000 shares authorized;
11,489,438 issued (11,465,842 at November 30, 1994) 11,489,000 11,466,000
Additional paid-in capital 166,189,000 165,921,000
Undistributed (distributions in excess of) net income 583,000 (1,292,000)
- --------------------------------------------------------------------------------------------------
Total shareholders' equity 178,261,000 176,095,000
- --------------------------------------------------------------------------------------------------
$258,405,000 $256,035,000
==================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 3 -
<PAGE>
MGI PROPERTIES
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Three Months Ended Six Months Ended
May 31, 1995 May 31, 1994 May 31, 1995 May 31, 1994
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCOME
Rental and other income $11,161,000 $10,844,000 $21,882,000 $21,570,000
Interest on investment securities 122,000 93,000 322,000 167,000
Other 16,000 16,000 32,000 32,000
- ------------------------------------------------------------------------------------------------------------------------
Total Income 11,299,000 10,953,000 22,236,000 21,769,000
- ------------------------------------------------------------------------------------------------------------------------
EXPENSES
Property operating expenses 2,958,000 3,087,000 5,920,000 6,120,000
Real estate taxes 1,403,000 1,333,000 2,795,000 2,707,000
Depreciation and amortization 1,906,000 2,011,000 3,797,000 3,907,000
Interest 1,399,000 1,466,000 2,811,000 2,932,000
General and administrative 713,000 676,000 1,387,000 1,276,000
- ------------------------------------------------------------------------------------------------------------------------
Total expenses 8,379,000 8,573,000 16,710,000 16,942,000
- ------------------------------------------------------------------------------------------------------------------------
Income before net gain 2,920,000 2,380,000 5,526,000 4,827,000
Net gain -- -- 1,400,000 450,000
- ------------------------------------------------------------------------------------------------------------------------
Net income $ 2,920,000 $ 2,380,000 $ 6,926,000 $ 5,277,000
========================================================================================================================
PER SHARE DATA
Income before net gain $0.25 $0.21 $0.48 $0.42
Net gain -- -- 0.12 0.04
- ------------------------------------------------------------------------------------------------------------------------
Net income $0.25 $0.21 $0.60 $0.46
========================================================================================================================
Weighted average shares outstanding 11,484,293 11,446,617 11,479,645 11,443,963
========================================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 4-
<PAGE>
MGI PROPERTIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(unaudited)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Six Months Ended
May 31, 1995 May 31, 1994
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 6,926,000 $ 5,277,000
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 3,797,000 3,907,000
Net gain (1,400,000) (450,000)
Other (149,000) (1,140,000)
- -------------------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 9,174,000 7,594,000
- -------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of real estate (10,074,000) (12,927,000)
Additions to real estate (2,630,000) (1,093,000)
Addition to construction in progress, net (3,078,000) --
Net proceeds from sales of real estate interests 4,738,000 2,286,000
Cash distributions from real estate partnerships -- 100,000
Decrease in U.S. Government securities, net 22,000 120,000
Other (1,495,000) 126,000
- -------------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (12,517,000) (11,388,000)
- -------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Additions to mortgage and other loans payable, net 1,000,000 13,328,000
Repayment of mortgage and other loans payable (705,000) (7,037,000)
Cash distributions (5,051,000) (4,806,000)
Proceeds from sale of common shares and stock options
exercised 150,000 79,000
- -------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) financing activities (4,606,000) 1,564,000
- -------------------------------------------------------------------------------------------------------------------------
Net decrease in cash and short-term investments (7,949,000) (2,230,000)
- -------------------------------------------------------------------------------------------------------------------------
CASH AND SHORT-TERM INVESTMENTS
Beginning of period 12,892,000 11,816,000
- -------------------------------------------------------------------------------------------------------------------------
End of period $ 4,943,000 $ 9,586,000
=========================================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 5 -
<PAGE>
<TABLE>
<CAPTION>
MGI PROPERTIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited)
- ----------------------------------------------------------------------------------------------------------
Undistributed
Number of Additional (Distributions Total
Common Common Paid-in in Excess of) Shareholders'
Shares Issued Shares Capital Net Income Equity
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance at November 30, 1994 11,465,842 $11,466,000 $165,921,000 ($1,292,000) $176,095,000
Net Income -- -- -- 6,926,000 6,926,000
Distributions -- -- -- (5,051,000) (5,051,000)
Dividend reinvestment and 7,895 8,000 103,000 -- 111,000
share repurchase plan
Options exercised and other 15,701 15,000 165,000 -- 180,000
- ----------------------------------------------------------------------------------------------------------
Balance at May 31, 1995 11,489,438 $11,489,000 $166,189,000 $ 583,000 $178,261,000
==========================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 6 -
<PAGE>
MGI PROPERTIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Note 1: The results of the interim period are not necessarily indicative of
results to be expected for the entire fiscal year. The figures
contained in this interim report are unaudited and may be subject to
year-end adjustments. In the opinion of management, all adjustments
necessary for a fair presentation of financial position and results of
operations have been included and such adjustments include only the
normal accruals.
Note 2: On June 22, 1995, the Board of Trustees declared a cash dividend of
$.23 per share payable on July 13, 1995 to shareholders of record on
July 6, 1995. This dividend will aggregate $2.6 million.
Note 3: On June 28, 1995 the Trust acquired a 59,000 square-foot research
and development facility located in Tewksbury, Massachusetts for a
price of $2.3 million. The building is 100% occupied.
Note 4: At May 31, 1995, the market value of U.S. Government securities was
$0.6 million.
Note 5: Interest paid amounted to $3.1 and $2.9 million for the six-month
periods ended May 31, 1995 and May 31, 1994, respectively. The Trust
capitalized $.3 million of interest during the six-month period ended
May 31, 1995.
Note 6: At May 31, 1995, options to purchase an aggregate of 656,311 shares,
at exercise prices ranging from $7.375 to $15.375 per share, were
outstanding under MGI's stock option plans for employees and Trustees.
All options outstanding at May 31, 1995 expire on or before December
2004.
Note 7: MGI intends to qualify for the year ended November 30, 1995 as a
real estate investment trust under the provisions of Sections 856-860
of the Internal Revenue Code, as amended. Accordingly, no provision has
been made for Federal income taxes.
- 7 -
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
At May 31, 1995, liquidity was provided by $4.9 million in cash and investment
securities (of which $3.2 million is collateral for a letter of credit) and by
unused lines of credit totaling $22.0 million. Shareholders' equity of $178.3
million at May 31, 1995, when compared to $176.1 million at November 30, 1994,
principally reflects net income in excess of distributions.
Principal sources of funds in the first half of fiscal 1995 include property
operations, the proceeds from the sale of an industrial property located in
Memphis, Tennessee and advances from the Trust's credit facility. During the six
months ended May 31, 1995, these resources were used to pay dividends of $5.1
million, to acquire a 38,000 square-foot office building located in Boston,
Massachusetts at a price of $1.8 million, to acquire two Massachusetts
industrial buildings totaling 296,500 square feet for an aggregate price of $8.2
million, to fund $1.7 million of tenant improvements and $0.9 million of capital
improvements and to repay $0.7 million of indebtedness. In addition, the Trust
advanced a net $3.1 million to fund construction loan advances related to the
Bradlees department store, which is under construction.
Total mortgage and other loans payable aggregated $71.2 million at May 31, 1995,
a net increase of $0.3 million compared to November 30, 1994. The change
resulted from an increase of $1.0 million on the outstanding amount under the
Trust's lines of credit offset by scheduled principal amortization. In June
1995, the Trust completed a modification agreement with the existing lender of a
mortgage note which extended the maturity of the note from January 1997 to June
1, 2000, lowered the effective rate of 9% to 8.5% and paid $3.0 million so as to
reduce outstanding principal to $13.3 million. The Trust has executed
commitments for two mortgage notes, one for $9.3 million with a fixed rate of
7.875% and a term of ten years and the second for $9.4 million with a fixed rate
of 7.75% and a term of fifteen years. The borrowings should close in the third
quarter and the proceeds will be used to repay variable rate debt and to fund
real estate acquisitions and improvements. MGI believes it will continue to be
able to extend or refinance maturing mortgage loans upon satisfactory terms.
Scheduled loan principal payments due within twelve months of May 31, 1995 total
$1.5 million.
Cash requirements in 1995 include operations, distributions to shareholders,
capital and tenant improvements and other leasing expenditures required to
maintain MGI's occupancy levels and new investment undertakings. On June 28,
1995, the Trust acquired a 59,000 square-foot research and development facility
located in Tewksbury, Massachusetts for a price $2.3 million. The Trust has also
entered into an agreement for the purchase of a 66,000 square-foot research and
development facility located in Littleton, Massachusetts. The acquisition is
subject to the completion of due diligence and is expected to close in the third
quarter for a price of approximately $2.3 million. On March 21, 1995, the Trust
acquired a 189,000 square-foot research and development facility and
simultaneously entered into a fifteen-year net lease with Avid Technology, Inc.
for the entire building. The lease commits the Trust to tenant and capital
improvements of up to approximately $6.3 million payable over a twenty-seven
month period and the lease provides for corresponding increases in the rent as
funds are advanced.
- 8-
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
During 1994, the Trust signed a commitment to acquire a department store of
approximately 100,000 square feet, which is under construction, and will be
leased in its entirety by Bradlees under a twenty-year lease. On June 23, 1995
Bradlees announced that it filed for bankruptcy protection under Chapter 11 of
the Federal Bankruptcy Code following recent public reports regarding credit and
financial difficulties. The building is subject to MGI's $10,200,000
first-mortgage construction loan and certain guarantees of the developer and
Bradlees and a pending purchase contract which, subject to certain terms and
conditions (including occupancy by Bradlees), provides for MGI's acquisition of
the completed building at an additional $900,000 above its construction loan.
Under the Bankruptcy Code, Bradlees has sixty days from its filing, subject to
the extension by the court, to either disavow or affirm its lease. If it
disavows its lease, the landlord would be able to file a claim with the
Bankruptcy Court as a general creditor. It is not known whether Bradlees will
affirm or reject the lease in the bankruptcy proceeding. Should the lease be
disavowed and the building be vacant for some period, the Trust presently
estimates the earnings impact to be approximately $.025 per quarter. In
addition, the Trust may acquire title to the property through foreclosure or
otherwise. In any event, the Trust continues to believe that the building is
strategically located and the strength of the real estate will ultimately be
realized, although there can be no assurance thereof.
Principal sources of funds in the future are expected to be from property
operations, including those acquired in the future, lines of credit, mortgaging
or refinancing existing mortgages on properties and MGI's portfolio of
investment securities. Other potential sources of funds may include the proceeds
of offerings of additional equity or debt securities or the sale of real estate
investments. The cost of new borrowings or issuances of equity capital will be
measured against the anticipated yields of investments to be acquired with such
funds. The purchase of additional properties in 1995 may require the use of
funds from MGI's lines of credit, new borrowings, the sale of properties
currently owned or the issuance of equity securities. MGI believes the
combination of cash and investment securities, the value of MGI's unencumbered
properties and other resources are sufficient to meet its short- and long-term
liquidity and operational requirements.
Results of Operations
Net income for the quarter ended May 31, 1995 was $2.9 million, or $0.25 per
share, as compared to $2.4 million, or $0.21 per share in the corresponding
quarter of 1994. Net income for the six months ended May 31, 1995 was $6.9
million, or $0.60 per share, and included $1.4 million, or $0.12 per share, of
gain recognized in connection with the sale of an industrial building. Net
income for the six months ended May 31, 1994 was $5.3 million, or $0.46 per
share, and included a gain of $0.45 million, or $.04 per share, recognized in
connection with the sale of a partnership interest.
Funds from operations totaled $4.8 million, or $0.42 per share, in the 1995
second quarter, compared to $4.4 million, or $0.38 per share, in the
corresponding quarter of 1994. Funds from operations in the six months ended May
31, 1995 and 1994 were $9.3 million, or $0.81 per share, and $8.7 million, or
$0.76 per share, respectively. MGI defines funds from operations as net income
(computed in accordance with generally accepted accounting principles),
excluding gains (or losses) from debt restructuring, sales of property and
similar non-cash items, depreciation and amortization charges and equity method
partnership losses. MGI believes funds from operations is an appropriate
supplemental measure of operating performance. The change in funds from
operations is attributable to the same factors that affected income before net
gain with the exception of depreciation and amortization expense.
- 9 -
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
In comparing the second quarter of 1995 to that of the previous year, the
increase of $0.5 million in income before net gain resulted principally from
an increase of $0.4 million in property operating income with the balance due to
higher interest income and lower interest expense which were offset in part by
higher general and administrative expense. Property operating income, which is
defined as rental and other income less property operating expenses and real
estate taxes, increased to $6.8 million from $6.4 million.
The change in property operating income reflects improvements in comparable
properties owned throughout both quarters, as well as, the effect resulting from
the sales and acquisitions of properties during 1994 and 1995. The properties
sold had contributed $0.7 million of operating income in the second quarter of
1994. The loss of this income in 1995 was offset by $0.8 million of income from
acquisitions and $0.3 million of improved results from previously-owned
properties. With respect to the properties owned throughout both quarters, the
improvement reflects overall lower operating expenses, the recovery of rent
previously written off and overall higher occupancy for the portfolio compared
to 1994.
The same factors which contributed to the increase in income before net gain for
the quarter also explain the $0.7 million increase in income before net gain for
the six months ended May 31, 1995. Property operating income increased by $0.4
million due to improved results from previously-owned properties, while income
lost due to properties sold was approximately equal to the $1.4 million of
income from new acquisitions. The improvement in interest income of $0.2 million
reflects higher levels of short term investments due to the sale of properties
and higher rates. The decrease in interest expense is due to the capitalization
of interest totaling $0.3 million related to the Bradlees' construction project.
General and administrative expense has increased primarily as a result of
personnel related expenditures.
Average occupancy in the second quarter of 1995 was 94.2%, as compared to 93.5%
in the comparable quarter of 1994. Average retail occupancy during the 1995
second quarter was 94.0% compared to 92.3% in the 1994 second quarter. Average
occupancy in the office segment was 88.7% versus 87.9% for the second quarter of
1995 and 1994, respectively. The industrial segment was effectively at 100%
occupancy through the second quarters of 1995 and 1994. Average residential
occupancy increased to 95.3% from 93.9% for the comparable quarter of 1995 and
1994. Leases executed during the second quarter, related to 1995 expirations,
totaled 123,000 square feet. At May 31, 1995 scheduled commercial lease
expirations for the balance of 1995 approximate 228,000 square feet, of which
171,000 square feet is industrial, 51,000 square feet is office and 6,000 square
feet is retail.
Real estate investments are subject to a number of factors including changes in
general economic climate, local conditions (such as an oversupply of space, a
decline in effective rents or a reduction in the demand for real estate),
competition from other available space, the ability of the owner to provide
adequate maintenance, to fund capital and tenant improvements required to
maintain market position and control of operating costs. In many markets in
which the Trust owns real estate, over-building and local or national economic
conditions have combined to produce a trend of lower effective rents and longer
absorption periods for vacant space. As the Trust re-leases space, certain
effective rents may continue to be less than those earned previously. Management
believes its diversification by regional markets and property type reduces the
risks associated with these factors and enhances opportunities for cash flow
growth and capital gains potential, although there can be no assurance thereof.
- 10 -
<PAGE>
MGI PROPERTIES
PART II - OTHER INFORMATION
Item 1: Legal Proceedings: Not applicable.
Item 2: Changes in Securities.
At the Annual Meeting of shareholders of the Trust, held on March 22,
1995 (the "Annual Meeting"), the shareholders of the Trust approved an
amendment to Article VI, Section 6.1 of the Trust's Declaration of Trust
(the "Declaration of Trust") which increased the number of authorized
Preferred Shares from 2,000,000 to 6,000,000. Under the Declaration of
Trust, the Board of Trustees is authorized to designate the terms of any
series of Preferred Shares including dividend rates, voting rights,
redemption prices and conversions or other special rights, if any,
without further action by shareholders of the Trust.
It is not possible to state the actual effect of the authorization of
additional Preferred Shares upon the rights of holders of the Trust's
Common Shares until the Board of Trustees determines the respective
rights of the holders of one or more series of Preferred Shares. The
effects of such issuance could include, however: (i) reduction of the
amount otherwise available for payments of dividends on Common Shares if
dividends are payable on the Preferred Shares, (ii) restrictions on
dividends on Common Shares if dividends on the Preferred Shares are in
arrears, (iii) dilution of the voting power of Common Shares if the
Preferred Shares have voting rights and (iv) restrictions on the rights
of holders of Common Shares to share in the Trust's assets upon
liquidation until satisfaction of any liquidation preference granted to
the holders of Preferred Shares. The Trust has no present plans to issue
Preferred Shares.
Item 3: Defaults upon Senior Securities: Not applicable.
Item 4: Submission of Matters to a Vote of Security Holders.
The following matters were submitted to a vote of shareholders at the
Annual Meeting:
a) The election of three Trustees to serve for a term of three years
expiring on the date of the Trust's annual meeting in 1998 and until
their successors are elected and qualified. The vote on this was W.
Pearce Coues -- 10,503,260 affirmative and 113,110 withheld, Herbert
D. Conant -- 10,492,728 affirmative and 123,642 withheld, George S.
Bissell -- 10,468,727 affirmative and 147,643 withheld.
b) The approval of an amendment to the Declaration of Trust increasing
the number of authorized Preferred Shares from 2,000,000 to
6,000,000. The vote on this matter was 6,213,712 affirmative,
1,570,338 negative, 156,815 abstentions and 2,675,505 broker
non-votes.
Item 5: Other Information: Not applicable.
Item 6: Exhibits and Reports on Form 8-K:
a) Exhibits:
-Eleventh and Twelfth Amendments of Second Amended and Restated
Declaration of Trust (see page 13).
-Computation of Earnings Per Share (see page 12).
b) Reports on Form 8-K: None.
- 11 -
<PAGE>
MGI PROPERTIES
PART II - EXHIBIT A
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Three Months Ended Six Months Ended
May 31, 1995 May 31, 1994 May 31, 1995 May 31, 1994
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY
Net income $ 2,920,000 $ 2,380,000 $ 6,926,000 $ 5,277,000
====================================================================================================================
Weighted average number of shares
outstanding during the period 11,484,293 11,446,617 11,479,645 11,443,963
====================================================================================================================
Primary earnings per share $.25 $.21 $.60 $.46
====================================================================================================================
ASSUMING FULL DILUTION
Net income $ 2,920,000 $ 2,380,000 $ 6,926,000 $ 5,277,000
====================================================================================================================
Weighted average number of shares
outstanding during the period 11,484,293 11,446,617 11,479,645 11,443,963
====================================================================================================================
Earnings per share assuming full dilution $.25 $.21 $.60 $.46
====================================================================================================================
</TABLE>
Note: Outstanding stock options are not taken into account in the computation of
earnings per share as they are not materially dilutive.
- 12 -
<PAGE>
MGI PROPERTIES
PART II - EXHIBIT B
ELEVENTH AND TWELFTH AMENDMENTS OF SECOND AMENDED AND
RESTATED DECLARATION OF TRUST
Certificate of Eleventh Amendment of Second Amended and Restated Declaration of
Trust
The undersigned, a Trustee of MGI Properties (the "Trust"), hereby certifies
pursuant to Article XIV, Section 14.3 of the Second Amended and Restated
Declaration of Trust (the "Declaration of Trust") that a meeting of Trustees of
the Trust duly called and held on September 21, 1994, in accordance with the
Declaration of Trust, at which at least two-thirds of the Trustees then in
office were present and voting throughout, pursuant to Section 13.1 of the
Declaration of Trust, at least two-thirds of the Trustees of the Trust then in
office voted to increase the number of Common Shares which the Trust shall have
authority to issue, from 15,000,000 to 17,500,000 and to amend Section 6.1 of
the Declaration of Trust to read in its entirety as follows:
"Section 6.1 Description of Shares. The interest of the Shareholders hereunder
shall be divided into shares of beneficial interest which shall be known
collectively as "Shares," all of which shall be fully paid and no assessment
shall ever be made upon Shareholders. There shall be two classes of Shares; one
such class shall be known as "Common Shares," $1 par value, and other shall be
known as "Preferred Shares," $1 par value. The number of Common Shares which the
Trust shall have authority to issue is 17,500,000, and the number of Preferred
Shares which the Trust shall have authority to issue is 2,000,000."
/s/ W. Pearce Coues
-------------------
W. Pearce Coues
Certificate of Twelfth Amendment of Second Amended And Restated Declaration Of
Trust
The undersigned, a Trustee of MGI Properties (the "Trust"), hereby certifies
pursuant to Article XIV, Section 14.3 of the Second Amended and Restated
Declaration of Trust (the "Declaration of Trust") that at a annual meeting of
the Shareholders of the Trust duly called and held on March 22, 1995, in
accordance with the Declaration of Trust, at which a quorum was present and
voting throughout, pursuant to Section 13.1 of the Declaration of Trust, the
holders of Shares of the Trust representing not less than a majority of the
total number of votes authorized to be cast by Shares of all classes then
outstanding and entitled to vote thereon, voted to increase the number of
Preferred Shares which the Trust shall have authority to issue from 2,000,000 to
6,000,000 and to amend Section 6.1 of the Declaration of Trust to read in its
entirety as follows:
"Section 6.1 Description of Shares. The interest of the Shareholders hereunder
shall be divided into shares of beneficial interest which shall be known
collectively as "Shares," all of which shall be fully paid and no assessment
shall ever be made upon Shareholders. There shall be two classes of Shares; one
such class shall be known as "Common Shares," $1 par value, and other shall be
known as "Preferred Shares," $1 par value. The number of Common Shares which the
Trust shall have authority to issue is 17,500,000, and the number of Preferred
Shares which the Trust shall have authority to issue is 6,000,000."
/s/ W. Pearce Coues
-------------------
W. Pearce Coues
- 13 -
<PAGE>
MGI PROPERTIES
SIGNATURES
Pursuant to the requirements to 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.
Date: July 12, 1995 /s/ Phillip C. Vitali
Phillip C. Vitali
Executive Vice President and Treasurer
(Chief Financial Officer)
Date: July 12, 1995 /s/ David P. Morency
David P. Morency
Controller
(Principal Accounting Officer)
- 14 -
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-1995
<PERIOD-END> MAY-31-1995
<CASH> 0
<SECURITIES> 607
<RECEIVABLES> 000
<ALLOWANCES> 000
<INVENTORY> 000
<CURRENT-ASSETS> 8,718
<PP&E> 279,783
<DEPRECIATION> 35,646
<TOTAL-ASSETS> 258,405
<CURRENT-LIABILITIES> 5,195
<BONDS> 71,249
<COMMON> 11,489
000
000
<OTHER-SE> 166,772
<TOTAL-LIABILITY-AND-EQUITY> 258,405
<SALES> 11,161
<TOTAL-REVENUES> 11,299
<CGS> 000
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 000
<INTEREST-EXPENSE> 1,399
<INCOME-PRETAX> 2,920
<INCOME-TAX> 000
<INCOME-CONTINUING> 2,920
<DISCONTINUED> 000
<EXTRAORDINARY> 000
<CHANGES> 000
<NET-INCOME> 2,920
<EPS-PRIMARY> .25
<EPS-DILUTED> .25
</TABLE>
