MERIDIAN POINT REALTY TRUST 83, 10KSB40, 1999-03-30

MERIDIAN POINT REALTY TRUST 83
10KSB40, 1999-03-30
REAL ESTATE INVESTMENT TRUSTS

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<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-KSB

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

FOR THE FISCAL YEAR ENDED: DECEMBER 31, 1998

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 0-12166

MERIDIAN POINT REALTY TRUST `83
(Exact name of Small Business Issuer as specified in its charter)

CALIFORNIA 94-6542723
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)

8500 STATION STREET, SUITE 100
MENTOR, OHIO 44060
(Address of principal executive offices) (Zip Code)

ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE:
(440) 974-3770

Securities registered pursuant to Section 12(b) of the Act: NONE

Securities registered pursuant to Section 12(g) of the Act: SHARES OF BENEFICIAL
INTEREST

Check whether the Issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter period that the Issuer was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes [x]
No [ ]

Check if there is no disclosure of delinquent filers in response to Item 405 of
regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of

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Issuer's knowledge, in definitive proxy or information statements incorporated
by reference in Part III of this Form 10-KSB or any amendment to this Form
10-KSB. Yes [x] No [_]

State the Issuer's revenues for its most recent fiscal year. $101,893
--------

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. $1,069,254
----------

The Issuer had 3,031,618 shares of beneficial interest outstanding on March 22,
1999.

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MERIDIAN POINT REALTY TRUST `83
INDEX TO ANNUAL REPORT
ON FORM 10-KSB
<TABLE>
<CAPTION>
PART I Page
----
<S> <C>
Item 1: Business .................................................................... 4
Item 2: Properties .................................................................. 6
Item 3: Legal Proceedings ........................................................... 6
Item 4: Submission of Matters to a Vote of Security Holders ......................... 7

PART II

Item 5: Market for the Registrant's Common Equity and Related

Shareholder Matters ......................................................... 7
Item 6: Management's Discussion and Analysis or Plan of Operation ................... 8
Item 7: Financial Statements ........................................................ 12
Item 8: Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure .................................................... 13

PART III

Item 9: Trustees and Executive Officers of the Issuer ............................... 13
Item 10: Executive Compensation ...................................................... 15
Item 11: Security Ownership of Certain Beneficial Owners and

Management .................................................................. 16
Item 12: Certain Relationships and Related Transactions .............................. 17
Item 13: Exhibits, List and Reports on Form 8-K ...................................... 17
</TABLE>

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<PAGE> 4

- --------------------------------------------------------------------------------
PART I
- --------------------------------------------------------------------------------

ITEM 1. BUSINESS

The Company
- -----------

Meridian Point Realty Trust `83 (the "Company") is a business trust organized
under the laws of the State of California for the purpose of acquiring,
operating, holding for investment and ultimately selling income-producing
commercial and industrial real estate. The Company was formed as a
self-liquidating/finite-life real estate investment trust ("REIT"). Under this
self-liquidating policy, the Company may not invest net proceeds from sales or
refinancings in additional properties. The Company was formed on June 24, 1982
and commenced operations on April 12, 1983.

The Company was organized to qualify as a REIT under Sections 856-860 of the
Internal Revenue Code of 1986, as amended (the "Code"). Under the Code, a REIT
must meet certain criteria, including requirements that certain percentages of
its gross income be derived from specific sources and that it distribute
annually to its shareholders at least 95% of its REIT taxable income (as defined
in the Code).

On May 31, 1995, the Company entered into an Asset Purchase Agreement with a
newly formed infinite-life industrial REIT, Meridian Industrial Trust, Inc.
("MIT"). The Asset Purchase Agreement provided that the Company would sell all
but one of its real estate assets to MIT for approximately $3.6 million in cash,
390,360 shares of MIT common stock and the assumption of certain mortgage notes
and other liabilities by MIT. The Company's Charleston property was excluded
from the transaction because of MIT's concerns regarding the environmental
conditions at that property.

On February 22, 1996, the Company's shareholders approved the Asset Purchase
Agreement with MIT. On February 23, 1996, MIT acquired all of the Company's real
estate assets (other than the Charleston property) pursuant to the Asset
Purchase Agreement.

On February 23, 1996, the Company announced a dividend which was paid March 22,
1996 of approximately $1 million in cash (or $0.33 per share of beneficial
interest in the Company) and all of the 390,360 shares of MIT common stock (or
0.1287 of a share of MIT common stock per share of beneficial interest in the
Company) to shareholders of record at the close of business on March 12, 1996.

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<PAGE> 5

have consisted almost exclusively of cash and cash equivalents and its only
income is from investment of its remaining funds.

The Board of Trustees on August 22, 1997 declared a distribution in the amount
of $9,094,854, or $3.00 per share of beneficial interest, which was paid on or
about September 12, 1997 to shareholders of record as of the close of business
on September 2, 1997.

Management
- ----------

The Company's affairs are overseen by a Board of Trustees ("Trustees"). There
are five Trustees, three of whom are independent (i.e., not an affiliate of a
person or entity providing services for the Company other than in his or her
capacity as a Trustee). The current Trustees took office in late September 1998.
The Company has officers that oversee the daily management of the Company. These
officers report to the Trustees.

Effective February 24, 1996, the Company entered into an agreement with E & L
Associates, Inc. ("E & L") under which E & L provided asset management and
certain other administrative services to the Company. E & L received a monthly
fee of $10,000 plus reimbursement for other expenses incurred on behalf of the
Company. During the period ended December 31, 1998, E & L received management
fees of $100,000, all of which is included in Property Operating Costs on the
accompanying Statements of Operations. E & L is a wholly-owned subsidiary of a
company in which Lorraine O. Legg (the Company's former President, Chief
Executive Officer and a former Trustee) has an ownership interest. The agreement
between the Company and E & L was terminated by the current Trustees on
September 22, 1998.

In connection with the sale of the Charleston property, the Board of Trustees
adopted an incentive payment plan for E & L for arranging, structuring,
negotiating and closing the transaction. Under this plan, E & L received a fee
of $233,000 in September 1997.

Insurance
- ---------

Until the sale of Charleston, and in addition to other types of insurance
maintained by the Company, the Company carried comprehensive general liability
and excess liability coverage on the Charleston property in the aggregate amount
of $3,000,000 to insure against liability claims and the costs of defense.
Similarly, the Company insured against the risk of direct physical damage in
amounts necessary to reimburse the Company on a replacement basis for costs
incurred to repair or rebuild the Charleston property, including loss of rental
income during the construction period, in the aggregate amount of $5,500,000.

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Real Estate Considerations
- --------------------------

The ownership of real estate entails environmental risks and potential liability
to owners, including former owners. Environmental investigation at the Golden
Cove property sold to Meridian Industrial Trust ("MIT") in 1996 indicated that
soil at the property contained volatile organic compounds in concentrations that
exceeded the clean- up goals typically cited by the California Regional Water
Quality Control Board ("RWQCB"). As part of the sale transaction, the Company
was obligated to fully fund the remediation costs for which it had previously
accrued $140,000 in 1994. Approximately $95,000 was expended by the Company for
remediation costs through December 1997, and no amounts were expended in 1998.
The Company does not believe that any additional costs will be incurred, but
there can be no assurance to that effect. The Company may be entitled to seek
contribution and indemnity for the remediation costs against other potentially
responsible parties who may have caused the contamination at the property.

In the late 1980's, the San Francisco Bay Region of the RWQCB requested that the
Company investigate and characterize soil and groundwater contamination of the
Charleston property. The Company engaged an environmental engineering firm that
discovered the presence of trichloroethylene and other solvent chemicals in the
groundwater. The RWQCB deferred issuing a Site Cleanup Requirements ("SCRs")
order to give the Company time to complete the pending sale of the Charleston
property. As part of the sale, the purchaser agreed to indemnify the Company
broadly against the pending SCRs and other types of environmental claims. Its
indemnity is backed by an environmental insurance policy placed with Reliance
Insurance Company of Illinois. It is possible that the RWQCB could still name
the Company when it ultimately issues its SCRs order for the property based on
the Company's former ownership. If that occurs, the Company would tender the
SCRs order to the purchaser for compliance. Similarly, the Company would tender
any other environmental claim brought against it to the purchaser pursuant to
the indemnity.

ITEM 2. PROPERTIES

On August 22, 1997, the Company sold the Charleston property, its only remaining
real estate investment.

ITEM 3. LEGAL PROCEEDINGS

There are no material pending legal proceedings to which the Company is a party
or to which any of the assets of the Company is subject.

On June 12, 1998, the Turkey Vulture Fund XIII, Ltd., an Ohio limited liability
company (the "Fund"), filed a lawsuit, captioned Turkey Vulture Fund XIII, Ltd.
v. Herbert E. Stansbury, Jr., Peter O. Hansen, Lorraine O. Legg, Robert E.
Morgan, James M. Pollack and Doe 1 through Doe 10 (Sup. Ct. Ca. No. 995738),
against the now former trustees of the Company seeking monetary damages of
approximately $600,000 alleging that the

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now former trustees breached their fiduciary duties to the Company by failing to
preserve the Company's legal status as a REIT under the Code. The Fund's sole
Manager is Richard M. Osborne, now Chairman of the Board, Chief Executive
Officer and a Trustee of the Company. The Fund and the former trustees have had
ongoing discussions since the September 22, 1998 annual meeting regarding a
possible resolution of the lawsuit. On November 19, 1998, the Fund dismissed the
lawsuit without prejudice.

Prior to the current Trustees assuming office, the Company was notified by the
Nasdaq Stock Market that the Company's shares of beneficial interest, without
par value (the "Shares"), would be delisted from the Nasdaq SmallCap Market,
effective December 14, 1998. The Nasdaq Stock Market has taken this action
because the Company does not currently meet the Nasdaq SmallCap Market's
requirement that listed companies maintain a closing bid price of $1.00 or
greater for ten consecutive trading days before December 14, 1998 to comply with
the minimum bid price requirement. The Company appealed the potential delisting
and a hearing was held on February 19, 1999. The Company has not yet received
any determination from Nasdaq with respect to the potential delisting. There can
be no assurance that the listing will be maintained. Any delisting may have an
adverse effect on the liquidity of the Company's shares and the price of the
shares.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

- --------------------------------------------------------------------------------
PART II
- --------------------------------------------------------------------------------

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Until January 9, 1998, the principal market on which the shares were quoted was
the National Market of the Nasdaq Stock Market. Thereafter, the shares began
trading on the SmallCap Market of the Nasdaq Stock Market. The listing symbol of
the shares is MPTBS.

As of March 22, 1999, the Company had outstanding a total of 3,031,618 shares.
As of the same date, these shares were held by approximately 2,275 holders of
record (this figure does not reflect beneficial ownership of shares held in
nominee names).

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<PAGE> 8

The following table sets forth the published high and low closing sales prices
for the shares during each calendar quarter for 1997 and 1998 (amounts in
dollars).
<TABLE>
<CAPTION>
CALENDAR QUARTER HIGH LOW
---------------- ---- ---
1997

<S> <C> <C> <C>
First Quarter 3-1/2 2-7/8
Second Quarter 3-5/8 2-5/8
Third Quarter 4-1/4 13/16
Fourth Quarter 1-1/2 1

1998

First Quarter 1-1/2 0-7/8
Second Quarter 1-9/16 0-7/8
Third Quarter 1-1/16 0-1/2
Fourth Quarter 1 0-5/16
</TABLE>

In August 1997, the Company sold its remaining property holding and on September
12, 1997, paid a cash dividend of $9,094,854 (or $3.00 per Company share) to
shareholders of record on September 2, 1997. No dividends were paid to the
Company's shareholders in 1998. Under the REIT tax rules, the Company is
required to make distributions to shareholders that aggregate annually at least
95% of its taxable income. The Company did not have any taxable income in 1998
and, thus, the Company remains in compliance with this rule. In accordance with
the Company's organizational documents, dividend distributions to be made by the
Company will always be at the discretion of the Trustees. There can be no
assurance when or if dividends will resume.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Introduction and Discussion of Known Trends, Events and Uncertainties
- ---------------------------------------------------------------------

The Company was formed and currently operates as a self-liquidating, finite-life
REIT. As a self-liquidating, finite-life REIT, the Company may not invest net
proceeds from sales or refinancings in additional properties. Therefore, the
Company is unable to invest in additional properties. The current Trustees
intend to seek shareholder approval, as quickly as practicable, of an amendment
to the Company's Declaration of Trust to eliminate this self-liquidating policy.
The elimination of the self-liquidating policy would convert the Company to a
perpetual-life REIT. This change to a perpetual-life REIT would enable the
Company to continue to operate and grow by reinvesting proceeds from the sale of
the Company's properties into newly-acquired properties.

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<PAGE> 9

Since the Charleston property was sold in August 1997, the Company's remaining
assets consist almost entirely of cash and cash equivalents and investments in
mortgage-related assets.

The following discussion should be read in conjunction with the Company's
Balance Sheets and Statements of Operations and Cash Flows and the notes
thereto. Unless otherwise defined in this report, or unless the context
otherwise requires, the capitalized words or phrases referred to in this section
either: (a) describe accounting terms that are used as line items in such
financial statements, or (b) have the meanings ascribed to them in such
financial statements and the notes thereto.

Year 2000 Compliance
- --------------------

The Company is continuing its efforts to assess issues caused by the inability
of its information systems to properly process transactions using dates
beginning in the Year 2000. The Company is attempting to identify affected
software and develop a plan for correcting that software in the most effective
manner. Remediation of any potential issues regarding year 2000 compliance will
likely include the upgrading or replacement of older software with new programs
and systems, which will handle the Year 2000 and beyond. The Company anticipates
that most of the necessary upgrades and replacements will be in place before
mid-1999. The process of physically upgrading the software has already begun.

Because the Company's assets are in financial institutions and brokerage houses
and that the current operations, and consequently its computer needs, are
limited, the Company does not expect that Year 2000 compliance costs will have
any material adverse effect on the Company's liquidity or ongoing results of
operations. Such costs are expected to be less than $5,000. However, there can
be no assurance that the Company will be successful in implementing its Year
2000 remediation according to the anticipated schedule or that compliance costs
will not have a material adverse effect on the Company's future liquidity or
ongoing results of operations.

Liquidity and Capital Resources
- -------------------------------

The Company's liquidity and capital resources have been dramatically changed as
a result of the February 23, 1996 and August 22, 1997 asset sales and the June
1998 investment of approximately $2 million in short-term mortgage investments.
The Company's source of near-term liquidity is its unrestricted cash, which at
December 31, 1998 totaled $600,173 as compared to $2,886,339 for the same period
in 1997, a decrease of 79.2%. These funds are expected to be adequate to satisfy
the Company's overhead and operating expenses in the short term.

An annual meeting of shareholders was held on September 22, 1998, at which time
a proposed plan of liquidation was defeated by shareholders and a new Board of
Trustees was elected. The vote was declared official on September 28, 1998.
Before leaving

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office, the previous Board purchased additional Directors' and Officers'
indemnity insurance at a cost of $135,000, which was expensed in the third
quarter. The former Trustees also created the Meridian Indemnity Trust (the
"Indemnity Trust") to pay for the expenses of defending themselves against
potential litigation. The Indemnity Trust was funded with $350,000 of Company
funds, which along with interest is reflected as "Restricted Cash" on the
Company's accompanying Balance Sheet. Current management is attempting to
negotiate the release of these funds from the Indemnity Trust.

During the twelve months ended December 31, 1998, the Company had no cash
distributions. In the quarter ended September 30, 1997, the Company paid a cash
dividend of $3.00 per share of beneficial interest.

Material Changes in Results of Operations
- -----------------------------------------

Revenues
- --------

Rentals from Real Estate Investments totaled $0 and $907,831 for the years ended
December 31, 1998 and 1997, respectively. The decrease is the result of the sale
of the Charleston property, the Company's last remaining property, in August
1997.

Interest and Other Revenues were $101,893 and $272,529 for the years ended
December 31, 1998 and 1997, respectively. The decrease of $170,636, or 63% from
1998 to 1997 was primarily due to the sale of the Charleston property in August
1997 and the decreased Company's average cash balances available for investment
following distribution to the shareholders of the proceeds of the Charleston
sale.

Expenses
- --------

Interest and Amortization of Debt Discount totaled $0 and $262,771 for the years
ended December 31, 1998 and 1997, respectively. The decrease during 1998 was due
to the sale of Charleston and the corresponding payment of its mortgage note
payable on August 22, 1997.

Property Taxes for the years ended December 31, 1998 and 1997 were $0 and
$79,234, respectively. The decrease was due to the sale of the Charleston
property on August 22, 1997.

Property Operating Costs totaled $100,000 and $318,079 for the years ended
December 31, 1998 and 1997, respectively. The decrease of $218,079, or 69%, was
primarily due to the sale of Charleston on August 22, 1997. The 1998 costs
represent fees paid to E & L.

Legal Costs for the years ended December 31, 1998 and 1997 were $226,240 and
$102,229, respectively. The increase in 1998 of $124,011, or 121%, was due to
costs incurred by the Company prior to the current Trustees taking office in
September 1998

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arising from the proposed plan of dissolution and liquidation, the proxy
contest, and the defense of the Fund's lawsuit.

General and Administrative Expenses were $575,461 and $354,684 for the years
ended December 31, 1998 and 1997, respectively. The increased expenditures of
$220,777, or 62%, were primarily incurred prior to September 1998 when the
current Trustees took office and related to former Board of Trustees' evaluation
of the Company's future options, the charges related to the reimbursement of
proxy solicitation costs of $102,613, which reimbursement is conditioned upon
the authorization by the Company's shareholders of the conversion of the Company
to a perpetual-life REIT through an amendment to the Declaration of Trust, and
the purchase by former trustees of additional Directors' and Officers' indemnity
insurance of $219,143.

For the years ended December 31, 1998 and 1997, Depreciation, Amortization and
Other totaled $13,017 and $16,154, respectively. The 1998 expense represents an
unrealized loss on investment in Mortgage-Related Assets. The 1997 expense
represents amortization expense related to the lease commissions on the
Charleston property. Upon entering into an exclusive listing agreement for the
sale of the Charleston property on June 27, 1996, the Company ceased to
depreciate the property. Therefore, the Company did not record any depreciation
expense in 1997, and recorded only $16,154 of amortization expense related lease
commissions on the Charleston property.

Net Income (Loss)
- -----------------

As a result of the factors noted above, net loss was $812,825 for the year ended
December 31, 1998 compared to net income of $4,386,840 for the same period of
1997. The 1997 net income is primarily a result of the gain on the sale of the
Charleston property of $4,528,701.

Forward-Looking Statements
- --------------------------

Statements that are not historical facts, including statements about the
Company's confidence in its prospects and strategies and its expectations about
growth, are forward-looking statements that involve risks and uncertainties.
These risks and uncertainties include, but are not limited to (1) the Company's
continued tax status as a REIT, (2) the Company's inability to execute its
business plan involving a conversion from a self-liquidating, finite-life REIT
to a perpetual-life REIT, (3) the Company's continued listing on the Nasdaq
SmallCap Market, (4) changes in general economic conditions, (5) changes in
local real estate conditions, (6) the inability to generate sufficient revenues
to meet operating expenses, and (7) the failure to manage growth effectively.
Any investor or potential investor in the Company must consider these risks and
others that are detailed in other filings by the Company with the Securities and
Exchange Commission. These risks and others could cause actual results to differ
materially from those in the forward-looking statements.

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Election for REIT Status
- ------------------------

The Company has previously elected to be taxed as a REIT pursuant to Section
856(c)(1) of the Code and intends to be taxed as a REIT under the Code for the
fiscal year ended December 31, 1998. The REIT provisions of the Code generally
allow a REIT to deduct dividends paid to shareholders in computing the Company's
taxable income. No provisions for federal or state income taxes have been made
in the accompanying Statements of Operations.

To qualify for REIT status, the Company must meet a number of highly technical
organizational and operations requirements on a continuing basis. Those
requirements seek to ensure, among other things, that the gross income and
investments of a REIT are largely real estate related, with certain other
permitted assets, that a REIT distributes substantially all its ordinary taxable
income to shareholders on a current basis and that the REIT's ownership is not
overly concentrated. Due to the complex nature of these rules, the limited
available guidance concerning interpretation of the rules, the importance of
ongoing factual determinations and the possibility of adverse changes in or
interpretations of the law, administrative interpretations of the law and
developments at the Company, no assurance can be given regarding the Company's
qualification as a REIT for any particular year. As a result of the Company's
sale of its last real estate property in August 1997, the Company's status as a
REIT for 1997 and 1998 is dependent, in part, upon tax rules regarding
investments by REITs in certain types of non-real estate assets. The current
Board of Trustees is reviewing with legal counsel the Company's status as a REIT
for the years ended December 31, 1998 and 1997.

If the Company failed to qualify as a REIT for either the fiscal year ended
December 31, 1998 or 1997, it would be taxed as a regular corporation, and
distributions to shareholders would not be deductible in computing the Company's
taxable income. The resulting corporate tax liabilities, estimated to be
approximately $170,000, could materially reduce the funds available for
distribution to the Company's shareholders or for reinvestment. If the Company
failed to qualify as a REIT, distributions to shareholders would no longer be
required. In addition, distributions in 1997 originally treated as capital gain
distributions could be recharacterized as ordinary dividend distributions to
shareholders. Moreover, the Company might not be able to elect to be treated as
a REIT for the four taxable years after the year during which the Company ceased
to qualify as a REIT. If the Company later requalified as a REIT, it might be
required to pay a full corporate-level tax on any unrealized gain associated
with its assets as of the date of requalification and to make distributions
equal to any earnings accumulated during the period of non-REIT status.

ITEM 7. FINANCIAL STATEMENTS

The Company's Report of Independent Accountants and Financial Statements are
incorporated herein by reference and filed as part of this report.

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ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

The Company has not changed its independent certified public accountants and has
not had any disagreement with its independent certified public accountants on
accounting or financial disclosures required to be made under rules of the
Securities and Exchange Commission.

- --------------------------------------------------------------------------------
PART III
- --------------------------------------------------------------------------------

ITEM 9. TRUSTEES AND EXECUTIVE OFFICERS

Trustees and Executive Officers
- -------------------------------

The Trustees are elected annually and serve until the next annual meeting of
shareholders and until their successors are elected and qualified. The Company's
Declaration of Trust provides that the number of Trustees shall be not less than
five nor more than fifteen. Presently the authorized number of Trustees is five.
In addition, the Declaration of Trust provides that a majority of Trustees shall
be "Independent Trustees." An "Independent Trustee" generally means a Trustee
who is neither an affiliate of a person or entity providing services to the
Company nor is performing services for the Company other than as a Trustee.
Except for Richard M. Osborne and Thomas J. Smith, all Trustees are "Independent
Trustees."

The following table sets forth as to each person who currently serves as a
Trustee or as an executive officer, his name, age, and position with the
Company:
<TABLE>
<CAPTION>

Name Age Position
---- --- --------

<S> <C> <C> <C>
Richard M. Osborne 53 Chairman, Chief Executive Officer and a Trustee

Thomas J. Smith 54 President, Chief Operating Officer and a Trustee

Ronald L. Ramer 33 Chief Financial Officer and Assistant Secretary

Marc C. Krantz 38 Secretary and a Trustee

Steven A. Calabrese 37 Trustee

Mark D. Grossi 43 Trustee
</TABLE>

Officers of the Company hold office at the discretion of the Trustees. Each
trustee's and executive officer's principal occupations during the past five
years or more are set forth below.

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<PAGE> 14

Richard M. Osborne has been Chairman of the Board, Chief Executive Officer and a
Trustee of the Company since September 1998. Mr. Osborne is President and Chief
Executive Officer of OsAir, Inc., a company he founded in 1963. Mr. Osborne is
the sole Manager of Turkey Vulture Fund XIII, Ltd., which began operations in
January 1995. He is also a Director of Ceres Group, Inc., a publicly-held
insurance holding company, a Director of USP Real Estate Investment Trust, a
publicly-held real estate investment trust, a Director of NuMED Home Health
Care, Inc., a publicly-held home healthcare company, a Director and Chairman of
the Board of Pacific Gateway Properties, Inc., a publicly-held real estate
company ("Pacific Gateway"), and a Director and Vice Chairman of the Board of
GLB Bancorp, Inc., a publicly-held bank holding company. Mr. Osborne is the
managing member of Liberty Self-Stor, Ltd., a self-storage company.

Thomas J. Smith has been President, Chief Operating Officer and a Trustee of the
Company since September 1998. Since April 1, 1996, Mr. Smith has served as the
Executive Operating Manager of Liberty Self-Stor, Ltd. Mr. Smith has been the
President of Retirement Management Company since 1992. Mr. Smith also serves as
a Director of GLB Bancorp, Inc.

Ronald L. Ramer has been Chief Financial Officer and the Assistant Secretary of
the Company since September 1998. Mr. Ramer has been the Financial Manager of
Liberty Self-Stor, Ltd. since April 1, 1996. Mr. Ramer previously was the
controller of Retirement Management Company since 1993.

Marc C. Krantz has been the Secretary and a Trustee of the Company since
September 1998. Mr. Krantz is a Partner with the law firm of Kohrman Jackson &
Krantz P.L.L. and has been with that firm for the last five years.

Steven A. Calabrese has been a Trustee of the Company since September 1998. Mr.
Calabrese is serving as managing partner of Calabrese, Racek and Markos, Inc.,
CRM Construction, Inc. and CRM Environmental Services, Inc., firms which
specialize in evaluation, management, construction and environmental assessment
services for commercial and industrial real estate. Mr. Calabrese is a Director
of Pacific Gateway.

Mark D. Grossi has been a Trustee of the Company since September 1998. Mr.
Grossi is currently Executive Vice President and a Director of Charter One
Financial, Inc., a publicly-traded savings and loan holding company, and
Executive Vice President and Chief Retail Banking Officer of its subsidiary,
Charter One Bank. Mr. Grossi also serves as a Director of Pacific Gateway and a
Director of JB Oxford Holdings, Inc., a publicly-held brokerage company. Since
prior to 1993, Mr. Grossi has held various senior executive positions with
Charter One Bank and its predecessor.

Section 16(a) Beneficial Ownership Reporting Compliance
- -------------------------------------------------------

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's trustees and executive officers, and persons who own more than 10% of
the

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<PAGE> 15

Company's shares, to file with the Securities and Exchange Commission (the
"SEC") and the Nasdaq Stock Market initial reports of ownership and reports of
changes in ownership of the shares. Officers, trustees and greater than 10%
shareholders are required by SEC regulation to furnish the Company with copies
of all Section 16(a) forms they file.

Based solely on its review of copies of reports furnished to the Company or
written representations that no reports were required, the Company believes that
all Section 16(a) filing requirements were met in 1998.

ITEM 10. EXECUTIVE COMPENSATION

From February 23, 1996 until September 28, 1998, the Company had no employees
and no compensation was paid to its executive officers. On February 23, 1996,
the Company entered into an agreement with E & L, as described in Item 1 above,
to provide the Company asset management and certain other administrative
services. Lorraine O. Legg, the Company's former President, Chief Executive
Officer and a Trustee, has an ownership interest in a company which is the
parent company of E & L. The agreement with E & L was terminated by the current
Trustees on September 22, 1998. The Company paid E & L a total of $100,000 in
1998, $120,000 in 1997 and $95,000 in 1996.

The new officers of the Company, who took office on September 28, 1998, have
agreed to serve without salaries until a plan for converting the Company to a
perpetual-life REIT is approved by the shareholders.

Meetings of the Board of Trustees
- ---------------------------------

The current Board of Trustees met once in 1998 and all current Trustees
participated in the meeting. The former Board of Trustees met three times in
1998.

Trustee Compensation
- --------------------

Beginning in 1999, the Company will pay each Trustee, other than Messrs.
Osborne, Smith and Krantz, an annual fee of $5,000 in shares of the Company. In
addition, the Company will pay each such Trustee $250 in cash for each board
meeting that such Trustee participates in. Members of the current Board of
Trustees were not compensated for their services in such capacity in 1998.
Members of the former Board of Trustees were paid the following amounts for
their services in 1998:
<TABLE>
<CAPTION>

<S> <C>
Herbert E. Stansbury $ 14,700
Robert E. Morgan $ 4,900
Peter O. Hanson $ 5,200
James M. Pollak $ 5,200
</TABLE>

Lorraine O. Legg was not paid for her services as a Trustee during 1998.

15
<PAGE> 16

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICAL OWNERS AND MANAGEMENT

The following table sets forth the amount and nature of the beneficial ownership
of the Company's shares as of March 22, 1999 by (i) each person known by the
Company to own more than 5% of the outstanding shares (based upon filings made
with the Securities and Exchange Commission), (ii) each Trustee, (iii) each
executive officer, and (iv) all the Trustees and Executive Officers as a group.
<TABLE>
<CAPTION>
Amount of Shares
Name and Address Beneficially Owned Percentage
- ---------------- ------------------ ----------
<S> <C> <C>
Turkey Vulture Fund XIII, Ltd. 297,344(1) 9.8%
7001 Center Street
Mentor, Ohio 44060

Richard M. Osborne 297,344(1) 9.8%
7001 Center Street
Mentor, Ohio 44060

Steven A. Calabrese 290,265 9.6%
1110 Euclid Avenue, Suite 300
Cleveland, Ohio 44115

Mark D. Grossi -0- 0.0%
1215 Superior Avenue, 7th Floor
Cleveland, Ohio 44114

Marc C. Krantz -0- 0.0%
1375 E. Ninth Street, 20th Floor
Cleveland, Ohio 44114

Ronald L. Ramer -0- 0.0%
8500 Station Street, Suite 100
Mentor, Ohio 44060

Thomas J. Smith -0- 0.0%
8500 Station Street, Suite 100
Mentor, Ohio 44060

All Trustees and Executive Officers as a group 587,609 19.4%
</TABLE>

(1) Richard M. Osborne is the sole Manager of Turkey Vulture Fund XIII, Ltd., an
Ohio limited liability company, and may be deemed to be the beneficial owner of
all 297,344 shares owned by the Fund.

16
<PAGE> 17

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTION

Effective February 24, 1996, the Company entered into an agreement with E & L to
provide property management and certain other administrative services to the
Company. Under this agreement, E & L received a monthly fee of $8,333 to June
30, 1996. Effective July 1, 1996, the monthly fee was increased to $10,000.
During 1998, E & L received fees of $100,000. In 1997, E & L received fees of
$120,000 and, in connection with the sale of the Charleston property in August
1997, received a fee of $233,000 under an incentive plan adopted by the Trustees
for E & L's arranging, structuring, negotiating and closing the transaction. E &
L is a wholly-owned subsidiary of a company in which Lorraine O. Legg, the
Company's former President, Chief Executive Officer and a Trustee has an
ownership interest. Other than the management fees paid to E & L, Ms. Legg
received no other compensation from the Company. The agreement between the
Company and E & L was terminated by the current Trustees on September 22, 1998.

Before leaving office, the previous Board created the Indemnity Trust to pay for
the expense of defending themselves against potential litigation. The Indemnity
Trust was funded with $350,000 of Company funds which have been reflected as
restricted cash in the accompanying Balance Sheets as of December 31, 1998,
along with the applicable related interest income.

In connection with the proxy solicitation by Meridian `83 Shareholders'
Committee for Growth, the Fund, a shareholder of the Company, incurred expenses
of $102,613 which is included in general and administrative expenses in the
accompanying Statement of Operations for the year ended December 31, 1998. The
current Trustees authorized the expense reimbursement because of the benefit to
the Company of the proxy solicitation. The reimbursement is conditioned upon the
authorization by the Company's shareholders of the conversion of the Company to
a perpetual-life REIT through an amendment to the Declaration of Trust. Mr.
Osborne, the Company's Chairman of the Board and Chief Executive Officer, is the
sole Manager of the Fund.

ITEM 13. EXHIBITS, LIST, AND REPORTS ON FORM 8-K

(a) INDEX TO EXHIBITS
-----------------

NO. DESCRIPTION
- --- -----------

(In accordance with Item 601 of Regulation S-B)

2.1 Amended and Restated Asset Purchase Agreement dated November 10, 1995
between Meridian Point Realty Trust `83 and Meridian Industrial Trust, Inc.
(Filed as Appendix D to Registrant's Amendment #3 to Preliminary Proxy
Statement filed December 22, 1995 and incorporated herein by reference.)

17
<PAGE> 18

2.2 Purchase and Sale Agreement entered into August 4, 1997, together with
First Amendment to Purchase and Sale Agreement effective August 7, 1997
and Second Amendment to Purchase and Sale Agreement effective August 15,
1997, between Meridian Point Realty Trust `83 and 2400 Charleston
Associates, LLC (as successor to Rubin-Pachulski Properties, Inc.) (Filed
as Exhibit 10.1 to Registrant's Form 8-K dated September 5, 1997, and
incorporated herein by reference.)

3.1 Amended and Restated Declaration of Trust of the Registrant dated March
5, 1992 (Filed as Exhibit 3.l to Registrant's Form 10-K for the fiscal
year ended December 31, 1991 and incorporated herein by reference.)

3.2 Amended and Restated Trustees' Regulations of the Registrant dated March
5, 1992 (Filed as Exhibit 3.2 to Registrant's Form l0-K for the fiscal
year ended December 31, 1991 and incorporated herein by reference.)

3.3 Certificate of First Amended and Restated Declaration of Trust of the
Registrant dated July 12, 1993 (Filed as Exhibit 3.2 to Registrant's Form
10-Q for the quarter ended June 30, 1993 and incorporated herein by
reference.)

3.4 Amendments to Amended and Restated Declaration of Trust adopted February
10, 1995 (Filed as part of Registrant's Form 8-K dated February 10, 1995
and incorporated herein by reference.)

10.1 Agreement between Meridian Point Realty Trust `83 and E & L Associates,
Inc. dated February 23, 1996 (Filed as part of Registrant's Form 10-K
dated December 31, 1996 and incorporated herein by reference.)

10.2 * Indemnity Trust Agreement, dated as of September 2, 1998, by and between
Meridian Point Realty Trust `83 and U.S. Trust Company, N.A.

27.1 * Financial Data Schedule

(b) REPORTS ON FORM 8-K
-------------------

No Form 8-K reports were filed during the quarter ended December 31, 1998.

* Filed herewith

18
<PAGE> 19

SIGNATURES

Pursuant to the requirements of Section 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.

Dated: March 30, 1999 MERIDIAN POINT REALTY TRUST `83

By: /s/ Richard M. Osborne
-------------------------------------
Richard M. Osborne
Chairman and Chief Executive Officer
(Principal Executive Officer)

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 and
in the capacities and on the dates indicated.

/s/ Richard M. Osborne Dated: March 30, 1999
- ---------------------------------------
Richard M. Osborne
Chairman and Chief Executive Officer
(Principal Executive Officer)

/s/ Ronald L. Ramer Dated: March 30, 1999
- ---------------------------------------
Ronald L. Ramer
Chief Financial Officer
(Principal Financial and Accounting Officer)

/s/ Thomas J. Smith Dated: March 30, 1999
- ---------------------------------------
Thomas J. Smith
President, Chief Operating Officer and Trustee

/s/ Marc C. Krantz Dated: March 30, 1999
- ---------------------------------------
Marc C. Krantz
Secretary and Trustee

19
<PAGE> 20

/s/ Mark D. Grossi Dated: March 30, 1999
- ---------------------------------------
Mark D Grossi
Trustee

/s/ Steven A. Calabrese Dated: March 30, 1999
- ---------------------------------------
Steven A. Calabrese
Trustee

20
<PAGE> 21
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Shareholders and Board of Trustees of
Meridian Point Realty Trust '83:

We have audited the accompanying balance sheets of Meridian Point Realty Trust
'83 as of December 31, 1998 and 1997, and the related statements of operations,
shareholders' equity and cash flows for each of the three years in the period
ended December 31, 1998. These 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 financial statements referred to above present fairly, in
all material respects, the financial position of Meridian Point Realty Trust '83
as of December 31, 1998 and 1997, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1998, in
conformity with generally accepted accounting principles.

Arthur Andersen LLP

Cleveland, Ohio,
February 2, 1999.

<PAGE> 22

MERIDIAN POINT REALTY TRUST '83
-------------------------------

BALANCE SHEETS
--------------

DECEMBER 31, 1998 AND 1997
--------------------------
<TABLE>
<CAPTION>
ASSETS
------ 1998 1997
--------------- --------------
<S> <C> <C>

ASSETS:
Cash and cash equivalents $ 600,173 $ 2,886,339
Investments in mortgage-related assets, at market value
1,205,722 -
Restricted cash 357,728 -
Other assets, net 14,453 21,052
--------------- --------------
Total assets $ 2,178,076 $ 2,907,391
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------

LIABILITIES:
Accounts payable $ 185,567 $ 102,057
------------ ------------
COMMITMENTS AND CONTINGENCIES (Note 12)

SHAREHOLDERS' EQUITY:
Shares of beneficial interest - $1.00 stated value:
Authorized - Unlimited; 3,031,618 shares issued and
outstanding 3,031,618 3,031,618
Paid-in capital 22,755,694 22,755,694
Distributions in excess of income (23,794,803) (22,981,978)
------------ ------------
Total shareholders' equity 1,992,509 2,805,334
------------ ------------
Total liabilities and shareholders' equity $ 2,178,076 $ 2,907,391
============ ============
</TABLE>

The accompanying notes to financial statements are an
integral part of these balance sheets.

<PAGE> 23

MERIDIAN POINT REALTY TRUST '83
-------------------------------

STATEMENTS OF OPERATIONS
------------------------

FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
----------------------------------------------------
<TABLE>
<CAPTION>

1998 1997 1996
----------- ----------- -----------
<S> <C> <C> <C>
GROSS REVENUES:
Rentals from real estate investments $ - $ 907,831 $ 2,026,861
Interest and other 101,893 272,529 264,902
----------- ----------- -----------
Total revenues 101,893 1,180,360 2,291,763
----------- ----------- -----------
OPERATING EXPENSES:
Interest and amortization of debt discount -- 262,771 651,111
Property taxes -- 79,234 183,136
Property operating costs, including amounts
paid to related parties of $100,000,
$120,000 and $236,000, respectively 100,000 318,079 664,101
Legal costs 226,240 102,229 47,724
General and administrative, including
amounts paid to related parties of
$133,000, $75,000 and $56,000, respectively 575,461 354,684 276,283
Depreciation, amortization and other 13,017 16,154 372,240
----------- ----------- -----------
Total expenses 914,718 1,133,151 2,194,595
----------- ----------- -----------
(Loss) income before gain on sale of property
and extraordinary item (812,825) 47,209 97,168

Gain on sales of properties -- 4,528,701 2,582,606
----------- ----------- -----------

(Loss) income before extraordinary item (812,825) 4,575,910 2,679,774
Extraordinary item -
Prepayment penalty on paydown of debt -- (189,070) --
----------- ----------- -----------
Net (loss) income $ (812,825) $ 4,386,840 $ 2,679,774
=========== =========== ===========
NET (LOSS) INCOME PER COMMON SHARE - BASIC AND
DILUTED:
(Loss) income before extraordinary item $ (.27) $ 1.51 $ .88
Extraordinary item-
Prepayment penalty -- (.06) --
----------- ----------- -----------
Net (loss) income per common share $ (.27) $ 1.45 $ .88
=========== =========== ===========
</TABLE>

The accompanying notes to financial statements are an
integral part of these statements.

<PAGE> 24

MERIDIAN POINT REALTY TRUST '83
-------------------------------

STATEMENTS OF SHAREHOLDERS' EQUITY
----------------------------------

FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
----------------------------------------------------
<TABLE>
<CAPTION>
Distributions
Paid-in in excess
Shares Amount capital of income
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
BALANCE, January 1, 1996 3,031,618 $ 3,031,618 $ 22,755,694 $(19,953,304)

Net income -- -- -- 2,679,774

Distributions -- -- -- (1,000,434)
------------ ------------ ------------ ------------

BALANCE, December 31, 1996 3,031,618 3,031,618 22,755,694 (18,273,964)

Net income -- -- -- 4,386,840

Distributions -- -- -- (9,094,854)
------------ ------------ ------------ ------------

BALANCE, December 31, 1997 3,031,618 3,031,618 22,755,694 (22,981,978)

Net loss -- -- -- (812,825)
------------ ------------ ------------ ------------

BALANCE, December 31, 1998 3,031,618 $ 3,031,618 $ 22,755,694 $(23,794,803)
============ ============ ============ ============
</TABLE>

The accompanying notes to financial statements
are an integral part of these statements

<PAGE> 25

MERIDIAN POINT REALTY TRUST '83
-------------------------------

STATEMENTS OF CASH FLOWS
------------------------

FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
----------------------------------------------------
<TABLE>
<CAPTION>
1998 1997 1996
------------ ------------ ------------
<S> <C> <C> <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income $ (812,825) $ 4,386,840 $ 2,679,774
Adjustments to reconcile net (loss) income
to net cash provided (used) in operating
activities -
Depreciation and amortization -- 20,994 389,265
Unrealized loss on investments in
mortgage-related assets 13,017 -- --
Gain on sale of properties -- (4,528,701) (2,582,606)
Loss on early retirement of debt -- 189,070 --
Changes in operating assets and
liabilities-
Restricted cash (357,728) 1,580,139 (361,945)
Accounts receivable -- 32,353 161,443
Other assets, net 6,599 25,312 (129,724)
Accounts payable 83,510 88,918 (243,400)
Other liabilities -- (192,354) (325,911)
------------ ------------ ------------
Net cash provided (used) in
operating activities (1,067,427) 1,602,571 (413,104)
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from disposition of properties -- 11,650,000 3,603,849
Closing costs on disposition of assets -- (891,504) --
Improvements to existing real estate and
other -- (1,103) (116,461)
Investments in mortgage-related assets (2,019,460) -- --
Return of principal from mortgage-related
assets 800,721 -- --
------------ ------------ ------------
Net cash provided (used) in
investing activities (1,218,739) 10,757,393 3,487,388
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on mortgage notes -- (4,627,123) (162,346)
Payment on early extinguishment of debt -- (189,070) --
Cash distributions paid -- (9,094,854) (1,000,434)
------------ ------------ ------------
Net cash provided (used) in
financing activities -- (13,911,047) (1,162,780)
------------ ------------ ------------
</TABLE>

<PAGE> 26

-2-
<TABLE>
<CAPTION>

1998 1997 1996
------------ ------------ ------------
<S> <C> <C> <C>
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS $ (2,286,166) $ (1,551,083) $ 1,911,504
------------ ------------ ------------
CASH AND CASH EQUIVALENTS, beginning of period 2,886,339 4,437,422 2,525,918
------------ ------------ ------------

CASH AND CASH EQUIVALENTS, end of period $ 600,173 $ 2,886,339 $ 4,437,422
============ ============ ============

NON-CASH INVESTING AND FINANCING TRANSACTIONS:
Proceeds from sale of assets-
Shares of stock $ - $ - $ 6,392,145
Mortgages assumed - - 16,334,297
Disposition of properties, net - (6,192,676) (22,343,329)
Reduction in other assets related to
properties sold - (37,118) (1,403,250)
Distributions paid in shares of stock - - (6,392,145)
Redemption of investment - - (79,500)

SUPPLEMENTAL INFORMATION:
Interest paid $ - $ 257,930 $ 634,087

</TABLE>

The accompanying notes to financial statements
are an integral part of these statements

<PAGE> 27

MERIDIAN POINT REALTY TRUST '83

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1998

1. GENERAL:
--------

Meridian Point Realty Trust '83 (the "Company") is a business trust organized
under the laws of the State of California for the purpose of acquiring,
operating, holding for investment and ultimately selling income-producing
commercial and industrial real estate. The Company was formed as a
self-liquidating/finite-life real estate investment trust ("REIT"). Under this
self-liquidating policy, the Company may not invest net proceeds from sales or
refinancings in additional properties. The Company was formed on June 24, 1982
and commenced operations on April 12, 1983. On February 23, 1996, the Company
sold all of its real estate properties except for the Charleston Business Park
("Charleston") (Note 8). On August 22, 1997, the Company sold the Charleston
property. Following the sale, the Company's assets have consisted almost
entirely of cash and cash equivalents and investments in mortgage-related
assets. An annual meeting of shareholders was held on September 22, 1998, for
the purpose of electing trustees and approving and adopting a plan of
liquidation. The proposed plan of liquidation was defeated by shareholders and a
new Board of Trustees was elected. The vote was declared official on September
28, 1998.

2. ESTIMATES, RISKS AND UNCERTAINTIES:
-----------------------------------

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

From time to time, the Company is subject to legal claims arising in the
ordinary course of business in connection with the Company's prior ownership of
real estate and leasing of such real estate to tenants. The Company maintains
liability insurance, subject to customary deductibles and, accordingly,
management does not believe the ultimate resolution of such matters will have a
material effect in the Company's financial position or results of operations.

3. RECLASSIFICATIONS:
------------------

Certain amounts for the years ended December 31, 1997 and 1996 have been
reclassified to conform with the current year presentation.

4. CASH AND CASH EQUIVALENTS:
--------------------------

The Company considers all investments with an original maturity of three months
or less to be cash equivalents.

<PAGE> 28

-2-

5. INVESTMENTS IN MORTGAGE-RELATED ASSETS:
---------------------------------------

On June 29, 1998, the Company purchased four Real Estate Mortgage Investment
Conduits ("REMICs"). The Company has classified these investments as trading
securities under Statement of Financial Accounting Standard No. 115, "Accounting
for Certain Investments in Debt and Equity Securities." Accordingly, the
unrealized loss on these investments of $13,017 has been included in other
expenses in the accompanying statement of operations for the year ended December
31, 1998. Presented in the following table is a schedule of the REMIC's
purchased by the Company and their fair market values as of December 31, 1998.
<TABLE>
<CAPTION>

Stated Fair
REMIC Series Interest Rate Maturity Market Value
------------ ------------- -------- ------------
<S> <C> <C> <C>
FHLMC 1458 GA 6.750% 05/15/04 $ 263,381

FNMA 96-2 B 7.500% 10/22/09 296,085

FHLMC 1432 E 6.750% 01/15/06 289,053

FHLMC 1472 E 6.250% 02/15/05 357,203
----------
$1,205,722
==========
</TABLE>

6. RENTALS FROM REAL ESTATE INVESTMENTS:
-------------------------------------

Certain of the Company's leases required lessees to pay all or a portion of real
estate taxes, insurance and operating costs ("Expense Recaptures"). Expense
Recaptures of $233,540 and $351,186 for the years ended December 31, 1997 and
1996, respectively, have been included in rentals from real estate investments.

All leases were classified as operating leases. The Company recognized rental
income on the straight-line basis over the terms of the leases.

7. INVESTMENTS IN REAL ESTATE AND DEPRECIATION METHODS:
---------------------------------------------------

Depreciation and amortization were calculated under the straight-line method,
based upon the 35 year estimated lives of property and property additions.
Expenditures for maintenance, repairs and improvements which did not materially
prolong the normal useful life of an asset were charged to operations as
incurred. Leasing commissions and tenant improvements were amortized under the
straight-line method over the terms of the related leases.

8. SALES OF PROPERTIES:
--------------------

On August 22, 1997, the Company sold the Charleston property, the last property
remaining in its portfolio. The total sales price for the property was
$13,000,000 less a $1,350,000 credit for estimated remediation work (see Note
12) and related costs, resulting in a net sales price of $11,650,000. The sales
price was paid entirely in cash. Out of escrow, the Company used $4,557,500 of
the sales proceeds to pay off the then outstanding principal on the mortgage
note payable. The Company also paid $891,504 in closing costs and $189,070 in
mortgage prepayment penalties. In connection with the sale, the Company
recognized a gain on sale of property of $4,528,701.

<PAGE> 29

-3-

On February 23, 1996, the Company sold all of its real estate assets except
Charleston to Meridian Industrial Trust, Inc. ("MIT") for approximately $3.6
million in cash, 390,360 shares of MIT common stock, and the assumption of
certain mortgage notes and other liabilities aggregating approximately $16.3
million by MIT (collectively referred to as the "Asset Sale"). The MIT common
stock was valued at $6,392,145. The Company also paid approximately $1.4 million
in closing and other transaction costs. The gain recognized in the sale was
$2,582,606.

If the sale of the properties and investments had occurred on January 1, 1997,
the Company's unaudited pro forma results of operations for 1997 would have
been:
<TABLE>
<CAPTION>
<S> <C>
Revenues $ 272,529
Expenses - Legal, general and administrative 456,914
---------
Net loss $(184,385)
=========

Basic net loss per share $ (0.06)
=========
</TABLE>

9. EARNINGS PER SHARE:
-------------------

Basic earnings per share of beneficial interest is determined by dividing net
income (loss) by the weighted average number of shares of beneficial interest
outstanding during the period. Weighted average number of shares outstanding was
3,031,618 for each of the three years in the period ended December 31, 1998.
During the three years ended December 31, 1998, the Company had no dilutive
securities outstanding.

During the year ended December 31, 1998, the Company paid no cash distributions.
During the year ended December 31, 1997, the Company distributed $9,094,854, or
$3.00 per share of beneficial interest to shareholders of record as of the close
of business on September 2, 1997.

During the year ended December 31, 1996, the Company distributed cash of
$1,000,434, or $.33 per share of beneficial interest, and all of the 390,360
shares of MIT common stock (or 0.1287 of a share of MIT common stock per share
of beneficial interest in the Company) to shareholders of record at the close of
business on March 12, 1996.

The analysis below presents the amount of distributions paid to shareholders and
the percentage which the Company estimated to be taxable/nontaxable for 1997. In
1997, the Company also elected to distribute its capital gains to its
shareholders and a portion of the 1997 distribution was so designated.
<TABLE>
<CAPTION>

<S> <C>
Total distribution $9,094,854
==========
Capital gains distributions-
Taxable at 25% rate 30.04%
Taxable at 20% rate 22.34%

Nontaxable distributions 47.62%
----------
100.0%
==========
</TABLE>

<PAGE> 30

-4-

10. INCOME TAXES:
-------------

The Company has previously elected to be taxed as a REIT pursuant to Section 856
(c) (1) of the Internal Revenue Code of 1986, as amended (the "Code"), and
intends to be taxed as a REIT under the Code for the fiscal year ended December
31, 1998. The REIT provisions of the Code generally allow a REIT to deduct
dividends paid to shareholders in computing the Company's taxable income. No
provisions for federal or state income taxes have been made in the accompanying
statements of operations.

If the Company failed to qualify as a REIT for either the year ended December
31, 1998 or 1997, it would be taxed as a regular corporation, and distributions
to shareholders would not be deductible in computing the Company's taxable
income. The resulting corporate tax liabilities, estimated to be approximately
$170,000, could materially reduce the funds available for distribution to the
Company's shareholders or for reinvestment. If the Company failed to qualify as
a REIT, distributions to shareholders would no longer be required. In addition,
distributions in 1997 originally treated as capital gain distributions could be
recharacterized as ordinary dividend distributions to shareholders. Moreover,
the Company might not be able to elect to be treated as a REIT for the four
taxable years after the year during which the Company ceased to qualify as a
REIT. If the Company later requalified as a REIT, it might be required to pay a
full corporate-level tax on any unrealized gain associated with its assets as of
the date of requalification and to make distributions equal to any earnings
accumulated during the period of non-REIT status.

11. RELATED PARTIES:
----------------

From April 1, 1991 to February 23, 1996, the Company operated under a
self-administered management structure in conjunction with other
commonly-sponsored real estate companies (collectively, the Companies). Under
this management structure, Meridian Point Properties, Inc. ("MPP"), a captive
company controlled by the Companies, leased employees to the Companies at cost
to perform the administrative, accounting, asset management and property
management functions. The reimbursements made to MPP were allocated among the
Companies in accordance with agreements between MPP and the Companies. Cost
reimbursements made to MPP pursuant to this management structure amounted to
$140,000 in 1996 and are included in property operating costs in the
accompanying statements of operations. There were no cost reimbursements in 1997
or 1998.

<PAGE> 31

-5-

Effective February 24, 1996, the Company entered into an agreement with E&L
Associates, Inc. ("E&L") under which E&L provided asset management and certain
other administrative services to the Company. E&L received a monthly fee of
$10,000 plus reimbursement for other expenses incurred on behalf of the Company.
During the three years ended December 31, 1998, 1997 and 1996, E&L received
management fees of $100,000, $120,000 and $95,000, respectively, all of which is
included in property operating costs in the accompanying statements of
operations. E&L is a wholly-owned subsidiary of a company in which Lorraine O.
Legg (the Company's former President, Chief Executive Officer and a former
Trustee) has an ownership interest. The agreement between the Company and E&L
was terminated by the current Board of Trustees on September 22, 1998.

In connection with the sale of the Charleston property, the Board of Trustees
adopted an incentive payment plan for E&L for arranging, structuring,
negotiating and closing the transaction. Under this plan, E&L received a fee of
$233,000 in September 1997. This amount was netted against the gain on sale of
the property.

Before leaving office, the previous Board created the Meridian Indemnity Trust
(the "Trust") to pay for the expense of defending themselves against potential
litigation. The Trust was funded with $350,000 of Company funds which have been
reflected as restricted cash in the accompanying balance sheets as of December
31, 1998, along with the applicable related interest income.

In connection with the proxy solicitation by Meridian '83 Shareholders'
Committee for Growth, Turkey Vulture Fund XIII, Ltd. (the "Fund"), a shareholder
of the Company, incurred expenses of $102,613 which is included in general and
administrative expenses in the accompanying statement of operations for the year
ended December 31, 1998. The Board of Trustees authorized the expense
reimbursement because of the benefit to the Company of the proxy solicitation.
The reimbursement is conditioned upon the authorization by the Company's
shareholders of the conversion of the Company to a perpetual-life REIT through
an amendment to the Declaration of Trust. Richard M. Osborne, the Company's
Chairman of the Board and Chief Executive Officer, is the sole manager of the
Fund.

At December 31, 1998, the Company has $600,173 of cash and cash equivalents at a
financial institution which is partially owned by a group controlled by the
Chairman and Chief Executive Officer of the Company.

For the years ended December 31, 1998, 1997 and 1996, the Company incurred fees
and expenses for services rendered by the Trustees of the Company totaling
$30,000, $75,000 and $56,000, respectively.

12. COMMITMENTS AND CONTINGENCIES:
------------------------------

The ownership of real estate entails environmental risks and potential liability
to owners, including former owners. Environmental investigation at the Golden
Cove property sold to Meridian Industrial Trust ("MIT") in 1996 indicated that
soil at the property contained volatile organic compounds in concentrations that
exceeded the clean-up goals typically cited by the California Regional Water
Quality Control Board (the "RWQCB"). As part of the sale transaction, the
Company was obligated to fully fund the remediation costs, for which it had
previously accrued $140,000 in 1994. Approximately $95,000 had been expended by
the Company for remediation costs through December 1998, and it does not believe
that any additional costs will be incurred, however there can be no assurance to
that effect. The Company may be entitled to seek contribution and indemnity for
the remediation costs against other potentially responsible parties who may have
caused the contamination at the property.

<PAGE> 32

-6-

In the late 1980's, the San Francisco Bay Region of the RWQCB requested that the
Company investigate and characterize soil and groundwater contamination of the
Charleston property. The Company engaged an environmental engineering firm that
discovered the presence of trichloroethlylene and other solvent chemicals in the
groundwater. The RWQCB deferred issuing a Site Cleanup Requirements ("SCRs")
order to give the Company time to complete the pending sale of the Charleston
property. As part of the sale, the purchaser agreed to indemnify the Company
broadly against the pending SCRs and other types of environmental claims. Its
indemnity is backed by an environmental insurance policy placed with Reliance
Insurance Company of Illinois. It is possible that the RWQCB could still name
the Company when it ultimately issues its SCRs order for the property based on
the Company's former ownership. If that occurs, the Company would tender the
SCRs order to the purchaser for compliance. Similarly, the Company would tender
any other environmental claim brought against it to the purchaser pursuant to
the indemnity.

<PAGE> 1
EXHIBIT 10.2

MERIDIAN POINT REALTY TRUST '83

INDEMNITY TRUST AGREEMENT

This Indemnity Trust Agreement ("Agreement") is made and
entered into as of this 2nd day of September, 1998, by and between Meridian
Point Realty Trust '83, a California business trust (the "Company"), and U.S.
Trust Company, N.A., a national banking association (the "Trustee").

A. In order to attract qualified persons to serve as trustees
and officers, (i) the Company has secured a policy of D&O insurance which
provides insurance protection to its trustees and officers against certain, but
not all, liabilities which may be incurred by them on account of their service
to the Company, (ii) the Company's Declaration of Trust (as defined below)
contains certain exculpation and indemnification provisions for the benefit of
the Company's trustees and officers, and (iii) the Company has entered into
Indemnity Agreements identified on EXHIBIT "A" hereto with those currently
serving as trustees providing for indemnification of such trustees to the full
extent authorized or permitted by the Declaration of Trust or by statute and in
the event they are made a party to any proceeding by reason of serving as a
trustee or officer of the Company.

B. On June 12, 1998, Turkey Vulture Fund XIII, Ltd., a
shareholder of the Company, filed a complaint (the "Action") in the California
Superior Court in San Francisco (Case No. 995738) against the trustees of the
Company claiming that they breached their fiduciary duty to the plaintiff by
allegedly failing to preserve the Company's legal status as a "real estate
investment trust" for federal tax purposes.

C. The Company is proceeding with plans to call and hold an
annual meeting of its shareholders to consider and vote on, among other things,
the election of trustees and the approval and adoption of a plan of complete
liquidation and dissolution of the Company.

D. The Company believes it desirable to create a trust fund to
secure its obligations to its trustees and officers to satisfy indemnity claims
and to advance expenses under the Declaration of Trust and Indemnity Agreements
by virtue of the Action or otherwise.

E. Those currently serving as trustees and officers of the
Company have each delivered to the Company an undertaking, as required by the
Declaration of Trust and Indemnity Agreements, to repay the amount of any
expenses so advanced if it shall be determined ultimately that he or she is not
entitled to indemnification therefor.

F. The Trustee is willing to hold, manage and distribute that
trust fund upon all of the terms and conditions set forth in this Agreement.

<PAGE> 2

AGREEMENT

Based upon the foregoing, and in consideration of the mutual covenants set
forth in this Agreement, the Trustee accepts the Trust (as defined below)
created hereby and agrees to hold all property which it may receive in trust for
the purposes and on the terms and conditions set forth herein, and the parties
hereto hereby agree, for the express benefit of the Agents (as defined below),
as follows:

1. DEFINITIONS. As used in this Agreement:

1.1 "Agent" or "Agents" shall mean those trustees and officers of the
Company listed on EXHIBIT "B" hereto and their respective spouses, successors,
heirs, executors, administrators, estates, legal representatives and assigns,
Any individual who is an Agent shall remain an Agent for the purposes of this
Agreement during the term hereof despite his or her resignation, removal or
other failure to continue in any capacity with the Company, and no person shall
be removed from such list of Agents without that person's written consent.

1.2 "Assets" shall mean the cash, securities and other investments from
time to time held in the Trust.

1.3 "Company" shall mean Meridian Point Realty Trust '83 and any successor
to the Company or substantially all of its business and operations.

1.4 "Declaration of Trust" shall mean the Amended and Restated Declaration
of Trust of the Company filed May 12, 1992, together with the First and Second
Amendments thereto.

1.5 "Designated Agent" shall mean Lorraine 0. Legg or such other Agent as
shall be designated from time to time by 66 2/3% of the Agents by notice to the
Trustee.

1.6 "Expenses" shall mean any and all costs and expenses (including
attorneys' and expert witnesses' fees and disbursements), judgments, fines and
amounts paid in settlement in connection with any existing or threatened action,
suit or proceeding for which the Agents may be entitled to indemnification under
the Declaration of Trust or the Indemnity Agreements.

1.7 "Indemnity Agreements" shall mean those Indemnity Agreements identified
on EXHIBIT "A" hereto.

1.8 "Trust" shall mean the trust account established hereunder, adjusted
from time to time for permissible additions and charges hereunder.

2. THE TRUST.

2.1 INITIAL DEPOSIT. Concurrently with the execution of this Agreement, the
Company has delivered to the Trustee cash in the amount of $350,000, receipt of
which is hereby acknowledged by the Trustee, which the Trustee shall promptly
deposit in a special trust account

<PAGE> 3

which has been established by the Trustee for the sole benefit of the Agents and
the Company under the name the "Meridian Indemnity Trust".

2.2 ADDITIONAL DEPOSITS. After the date hereof, the Company shall promptly
deposit additional cash and/or securities upon the written request of 66 2/3% of
the Agents. The Trustee shall have no duty or obligation whatsoever to ensure
that the Company complies with its obligations under this, Section 2.2.

2.3 DIRECTION OF INVESTMENT. The Assets shall be invested and reinvested by
the Trustee in United States Treasury bills having a maturity of 30 days or less
("30-Day Treasuries"), and all interest, income and profit shall be added to and
become a part of the Trust, and all brokers' commissions, fees, expenses and
losses, if any, relating thereto shall be charged against the Trust. In the
event that 30-Day Treasuries have matured, and the Assets invested in such
matured 30-Day Treasuries cannot immediately be reinvested in 30-Day Treasuries,
the Trustee shall place any such Assets in a money market account pending
reinvestment. Notwithstanding any provision to the contrary in this Section 2.3,
the Trustee is hereby directed to hold uninvested such monies or to liquidate
and/or sell such Assets as the Trustee, in its sole discretion, considers
necessary to meet anticipated and imminent disbursements, including any payments
pursuant to Sections 3 or 5.3 hereof, without regard to any penalty or loss
incur-red as a result of liquidation prior ' r to the maturity or sale of such
Assets. To the extent the Trustee is uncertain as to the appropriate action to
be taken in regard to the investment of the Assets, the Trustee shall be
permitted to accept instructions in that regard from the Designated Agent. The
Trustee shall not be liable or responsible for making any investment authorized
by the provisions of this Agreement, in the manner provided in this Agreement or
omitting to make any investment not authorized by this Agreement, or for any
loss resulting from any such investment so made or omission to so make. The
Trustee may deem investments directed by the Designated Agent to be appropriate
investments without independent investigation thereof.

2.4 SUMMARY OF ACTIVITY; ACCESS TO BOOKS AND RECORDS. The Trustee shall,
from time to time upon the request of the Company, but not less often than
monthly, furnish the Company and the Agents with a summary of all activity
relating to the Trust; and if so requested by the Company, the Trustee shall
permit the Company or its authorized representatives (including without
limitation its independent public accountants) to access to its books and
records relating to the Trust for the purpose of auditing the Trust and the
activities therein.

2.5 TAXES. Unless the Company elects to prepare and file the tax returns of
the Trust and timely notifies the Trustee in writing of its election to do so,
the Trustee shall prepare and file the tax returns of the Trust. T he amounts,
if any, due in respect of taxes shall be determined by the Company if the
Company elects to prepare the tax returns and gives timely written notice to the
Trustee, and otherwise shall be determined by the Trustee. Any and all amounts
due in respect of taxes shall be shall be paid by the Trustee out of the Assets
of the Trust.

3. USE OF THE TRUST.

3.1 REQUEST FOR ADVANCEMENT OR REIMBURSEMENT OF EXPENSES. If, during the
term of this Agreement, any Agent becomes entitled to advancement or
reimbursement of Expenses pursuant to the Declaration of Trust or the Indemnity
Agreements between the

<PAGE> 4

Company and that Agent, the Agent shall submit to the Trustee, with a copy to
the Company, a request for withdrawal from the Trust substantially in the form
of EXHIBIT "C" hereto. Any Agent may also submit to the Trustee, with a copy to
the Company, authorization for his or her counsel to submit to the Trustee
requests for withdrawal from the Trust on his or her behalf substantially in the
form of EXHIBIT "D" hereto. Any requests for withdrawal submitted by counsel
shall be in the form of a letter on the letterhead of such counsel indicating
the amount of the withdrawal requested and the Agents for whom the services were
rendered. The Trustee shall, at the request of any one or more of the Agents or
their counsel, subject to the provisions of Section 3.2 hereof, provide funds to
or for the benefit of that Agent for the payment of the Expenses incurred by
that Agent. (An amount shall be deemed to be paid to or on behalf of an Agent if
it is paid to the Agent or to his or her counsel, expert witness or other
provider of services to the Agent as reflected on bills accompanying the Request
or submitted by counsel and shall include the Agent's pro rata share of amounts
paid to counsel, expert witness or other provider of services to more than one
Agent or in respect of bills rendered thereby.) The Trustee shall be under no
duty or obligation to determine whether an Agent is entitled to indemnification
under the Declaration of Trust of the Indemnity Agreements or to take any-action
to obtain reimbursement to the Trust if such reimbursement is required.

3.2 PAYMENT BY THE TRUSTEE. Upon receipt by the Trustee of a request for
withdrawal submitted in accordance with the requirements herein, the Trustee
shall pay such bill(s) within 15 calendar days after receipt of the request and
shall charge the Trust for the amount thereof, provided, however, that if the
request for withdrawal is being submitted by counsel on behalf of an Agent or
Agents, the Designated Agent shall acknowledge his or her approval thereof
before payment shall be made by the Trustee. The Trustee may conclusively rely
on the representations of the Agent or his or her counsel set forth in the
request and shall not be liable to any party for acting upon such reliance.
Requests shall be paid by the Trustee in the order received; provided, however,
that, if the Trustee does not have sufficient funds in the Trust to satisfy in
full a request or all requests received on the same day, the Trustee shall make
pro rata payments (of the same percentage of each request) to the Agents who
have made such requests or on whose behalf such requests have been made after
deducting from the Trust any amounts chargeable under Section 5.3 hereof, If the
Company makes additional deposits to the Trust after the Trustee has made such
pro rata payments, the Trustee shall continue to make payments to Agents in
accordance with the preceding sentence unfit any such partially paid requests
have been satisfied, and thereafter to satisfy subsequent requests.

3.3 USE OF ASSETS. The Assets in the Trust shall not be used for any
purpose other than (i) investment, as provided in Section 2.3 hereof, (ii)
payment of Expenses, as provided in Section 3 hereof, and (iii) payment of the
Trustee's compensation expenses and certain taxes in accordance with Section 5.3
hereof.

3.4 DISPUTE BETWEEN AGENT AND COMPANY. The right of any Agent to demand and
receive payments from the Trustee shall not be affected or diminished in any way
by the existence of any dispute between the Agent and the Company, and the
Trustee shall be entitled to rely upon the simple request of the Agent or his or
her counsel pursuant to Section 3 hereof in making distributions from the Trust.
The Trustee shall have no responsibility to inquire into. the accuracy or
truthfulness of any such request. Distributions shall be made by the Trustee
notwithstanding any notice or demand by or on behalf of the Company that the
distribution

<PAGE> 5

should not be made, whether based on the Company's claim that any Agent. is not
entitled to all or part of the amount of the distribution or otherwise. The
Trustee shall have no responsibility or liability to the Company for making any
payment despite having received any such notice or demand by or on behalf of the
Company or otherwise.

4. TERM AND TERMINATION.

4.1 TERM. This Agreement shall become effective upon the date of its
execution and shall exist until terminated in accordance with Section 4.2
hereof. The Company may under no circumstances withdraw, or cause the Trustee to
withdraw, amounts from the Trust prior to termination.

4.2 TERMINATION. Notwithstanding Section 4.1 hereof, this Agreement shall
terminate on the first to occur of the following: (i) the date upon which the
Assets in the 30 days following receipt by the Trust have an aggregate value of
$ 10,000 or less; or (ii) 30 days following receipt by the Trustee of the
following documentation: (a) written notice by the. Company (executed by either
the President or a Vice President and either the Secretary or an Assistant
Secretary of the Company) to the Trustee and all Agents of the Company's
determination to terminate this Agreement, accompanied by a certified copy of
the resolution of the Board of Directors of the Company authorizing such
termination; (b) written consent to terminate this Agreement executed by all the
Agents and (c) a written representation that the Company is-not aware of any
facts, or any pending or threatened claim or action, the existence of which
would preclude the Company from terminating this Agreement pursuant to this
Section 4.2 certified to be accurate by either the President or a Vice President
and either the Secretary or an Assistant Secretary of the Company. The Trustee
shall have no obligation to determine whether the representations contained in
the documentation required to be presented to it hereunder are truthful and
accurate and may rely, and shall be protected in relying, on any instrument
reasonably believed to be genuine and to have been signed by the proper party or
parties, unless the Trustee shall have received written notification of facts to
the contrary. So long as the Trustee has not received any such written
notification, the Trustee shall not be liable to any party, including but not
limited to the Agents, or any of them, for disbursing the Assets to the Company
upon receipt of and such reasonable reliance upon the documentation required by
this Section 4.2. Notwithstanding the foregoing, the Company shall not have the
right to terminate this Agreement if (i) any claim or claims covered by the
Declaration of Trust, the Indemnity Agreements or this Agreement shall have been
made against the Agents, or any of them, (ii) the Company or the Agents, or any
of them, shall have received notice (written or oral) from any party that such
party intends to assert a claim holding the Agents, or any of them, responsible
for any alleged act or omission by the Agents, or any of them, which claim, if
made, would be covered by the Declaration of Trust, the Indemnity Agreements or
this Agreement, or (iii) the Company or the Agents, or any of them, shall be
aware of any facts which may subsequently give rise to a claim against the
Agents, or any of them, covered by the Declaration of Trust or the Indemnity
Agreements, until any such claim, asserted claim or facts have been resolved to
the satisfaction of the Agents. If the Company, by written notice to the Trustee
executed by the President of the Company, shall have irrevocably elected to
waive its right to terminate this Agreement or withdraw amounts from the Trust
prior to a specified date, however, the Company may not terminate this Agreement
or withdraw amounts from the Trust prior to such date.

<PAGE> 6

4.3 DISTRIBUTION ON TERMINATION. When this Trust is terminated in
accordance with Section 4 hereof, the Trustee shall distribute the Assets in the
Trust to the Company or its order, after payment of any outstanding requests for
withdrawal under Section 3 hereof or any deductions required or authorized by
Section 5.3 hereof.

5. THE TRUSTEE.

5.1 THE TRUSTEE'S DUTIES AND LIABILITIES.

5.1.1 This Agreement expressly sets forth all the duties of
the Trustee with respect to any and all matters pertinent hereto. No
implied duties or obligations shall be read into this Agreement
against the Trustee. The Trustee shall not be liable for any loss
sustained by the Trust by reason of the purchase, retention, sale or
exchange of any investment, and the Trustee shall incur no liability
with respect thereto except for its willful misconduct or gross
negligence as long as the Trustee has acted in accordance with the
terms and the conditions of this Agreement. The Trustee shall not be
under any duty to give the Assets held by it hereunder any greater
degree of care than it gives its own similar property.

5.1.2 The Trustee shall not be called upon to advise any
party as to the wisdom of selling or retaining or taking or refraining
from any action with respect to any securities or other property
deposited hereunder.

5.1.3 The Trustee makes no representation as to the
validity, value, genuineness or collectibility of any security or
other documents or instrument held by or delivered to it.

5.1.4 The Trustee shall be entitled to rely upon any order,
judgment, certification, demand, notice, instrument or other writing
delivered to it hereunder without being required to determine the
authenticity or the correctness of any fact stated therein or the
propriety or validity of the service thereof. The Trustee may act in
reliance upon any instrument or signature believed by it in good faith
to be genuine and may assume, if in good faith, that any person
purporting to give notice or receipt or advice or make any statement
or execute any document in connection with the provisions hereof has
been duly authorized to do so.

5.2 INDEMNIFICATION OF THE TRUSTEE. The Trustee shall not be liable
for any action taken or omitted by it in good faith and believed to be
authorized hereby or within the rights or powers conferred upon it hereunder, or
taken or omitted by it in accordance with advice of counsel (which counsel may
be of the Trustee's own choosing) that such action or omission is authorized
hereby or within the rights or powers of the Trustee hereunder, and shall not be
liable for any mistake of fact or error of judgment or for any acts or omissions
of any kind -unless caused by willful misconduct or gross negligence. The
Company agrees to indemnify, defend and hold harmless the Trustee, in its
individual and fiduciary capacity, and its respective agents, servants,
employees, trustees, stockholders, representatives, assigns and affiliates
against any and all liabilities, losses, claims, expenses (including reasonable
attorneys' fees) and damages incurred by it hereunder, except for liabilities,
losses, claims, expenses and damages incurred by

<PAGE> 7

the Trustee , resulting from its own willful misconduct or gross negligence,
provided that the Trustee has acted in accordance with the terms and the
conditions of this Agreement. The indemnities contained in this Section 5.2
shall be applicable whether or not the Trustee is then serving as the Trustee
and shall survive termination of the Trust.

5.3 EXPENSES AND COMPENSATION. The Trustee shall pay from the Trust,
to the extent not paid by the Company, within 30 days after an invoice therefor
has been presented to the Company by the Trustee, (i) the Trustee's reasonable
expenses of administration of the Trust, including reasonable compensation of
counsel and any agents engaged by the Trustee to assist in such administration,
and (ii) any taxes the Company has failed to pay pursuant to Section 2.5 hereof.
The Trustee shall be entitled to compensation for its services and reimbursement
for its costs in accordance with the provisions set forth on EXHIBIT "E" hereto.
The Trustee shall have a lien on the Trust for such compensation and expenses
until paid.

5.4 SETTLEMENT OF ACCOUNTS OF THE TRUSTEE. The Trustee shall keep full
accounts of all receipts and disbursements. Within 90 days after the close of
each year, or any termination of the duties of the Trustee, the Trustee shall
prepare, sign and submit in duplicate to the Company, with a copy to each Agent,
an accounting as the Trustee hereunder.

5.5 POWERS OF THE TRUSTEE. Unless otherwise limited by the terms of
this Agreement, the Trustee shall have, with respect to any property at any time
held by it and constituting part of the Trust, such powers as may be granted to
a trustee under California law.

5.6 ADMINISTRATIVE POWERS OF THE TRUSTEE. The Trustee shall have the
power, subject to Section 2.3 hereof, to do any of the following:

5.6.1 To cause any investment to be registered and held in
the name of one or more of its nominees, or one or more nominees of
any system for the central handling of securities, without increase or
decrease of liability;

5.6.2 To receive any and all money and other property due to
the Trust and to give full discharge therefor; and

5.6.3 To hold uninvested, without liability for interest
thereon, such monies received by the Trustee as the Trustee considers
necessary to meet anticipated and imminent disbursements.

5.7 RESIGNATION OR REMOVAL OF THE TRUSTEE.

5.7. 1 Resignation of the Trustee. The Trustee may resign at
any time by delivering a written notice of resignation to the Company
and to the Agents. resignation shall take effect on the date set forth
in such notice, which shall be no earlier than 60 days from the date
of such delivery to the Company unless a shorter time has been agreed
upon in writing by the Trustee and the Company; provided that a
successor trustee has been appointed pursuant to Section 5.7.2 or
Section 5.7.4 hereof.

5.7.2 Appointment of Successor Trustee. In the event of the
Company's receipt

<PAGE> 8

of notice of resignation by the Trustee pursuant to Section 5.7.1
hereof, a successor trustee shall be appointed by 66 2/3% of the
Agents within 30, days after such notice has been given. The
appointment of a successor trustee shall be effective upon the later
of (1) the date set forth as the effective date of such appointment in
an agreement supplementary hereto to assume any and all of the
obligations of the Trustee hereunder, and (ii) the date of delivery to
the Trustee of a copy of such -agreement so executed.

5.7.3 Successor Trustee. Upon the effective date of the
appointment of a successor trustee, the successor trustee, for all
purposes, shall be deemed to be the "Trustee" hereunder and all the
provisions of this Agreement shall relate to each successor with the
same force and effect as if such successor had been originally named
as the Trustee hereunder.

5.7.4 Petition to Court. If a successor trustee is not
appointed within 30 days after the Trustee gives notice of resignation
pursuant to Section 5.7.1 hereof, which appointment shall become
effective not later than the date of resignation of the Trustee as set
forth in the Trustee's notice of resignation, the Trustee, at the
expense of the Trust, may petition the court; pursuant to California
Probate Code Section 15640, to resign and the Trustee or any Agent may
petition the court, at the expense of the Trust, pursuant to
California Probate Code Section 17200, for appointment of a successor
trustee.

5.7.5 Transfer of Trust. Upon the effective date of the
appointment of a successor trustee pursuant to Section 5.7.2 hereof,
the Trustee shall promptly transfer all Assets in the Trust (less any
amounts due to the Trustee pursuant to Section 5.3 hereof) to the
successor trustee to-be held under and pursuant to the terms and
conditions of an agreement supplementary hereto or in the form hereof
to assume any and all of the obligations of the Trustee hereunder.

6. MISCELLANEOUS.

6.1 NOTICES. All notices, requests, demands, waivers, instructions a
and other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been given when personally
delivered or two business days after being deposited in the U.S. mail,
registered or certified, return receipt requested, with postage prepaid and
addressed as follows to the party to whom the notice, request, demand, waiver,
instruction or other communication is to be given, or at such other address as
that party shall designate by notice to the other parties in accordance with
this Section:

To the Company:

Meridian Point Realty Trust '83
655 Montgomery Street, Suite 800
San Francisco, CA 94111
Attention: President

<PAGE> 9

To the Trustee:

U.S. Trust Company, N.A.
515 S. Flower Street, Suite 2700
Los Angeles, California 90071-2291
Attention: Ms. Sandra H. Leess, Senior Vice President

To an Agent:

At the address set forth in EXHIBIT "B" hereto,
as amended from time to time by notice to the
Trustee by the Agent.

6.2 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of California.

6.3 SUCCESSORS AND ASSIGNS. This Agreement shall, subject to other
provisions hereof restricting assignment or delegation, be binding upon and
inure to the benefit of the parties hereto, their respective spouses,
successors, heirs,. executors, administrators, estates, legal representatives
and assigns. For purposes of this Agreement, all of the spouses, successors,
heirs, executors, administrators, estates, legal representatives and assigns of
any Agent shall collectively constitute a single Agent.

6.4 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, and by each party on separate counterparts, each of which shall be
deemed an original agreement, but all of which together shall constitute one and
the same instrument.

6.5 HEADINGS. Titles and headings to sections herein are for purposes
of reference only and shall in no way limit, define or otherwise affect the
interpretation of the provisions hereof.

6.6 IRREVOCABILITY OF TRUST; AMENDMENT. The Trust created by this
Agreement shall be irrevocable and shall not be revoked or terminated by the
Company or any person other than as specifically provided in Section 4 nor shall
it be amended, modified or supplemented except by an agreement in writing,
signed by the Company and the Trustee and approved in writing by all of the
Agents.

6.7 AGREEMENT FOR THE EXPRESS BENEFIT OF AGENTS. This Agreement has
been executed for the express benefit of the Agents and, to the maximum extent
permissible by law, none of the Assets in the Trust shall be attachable or
chargeable for the individual debts or obligations of the Company or any of the
Agents.

6.8 ENTIRE AGREEMENT. This Agreement (together with the Declaration of
Trust and Indemnity Agreements) constitutes and embodies the entire
understanding and agreement of the parties hereto relating to the subject matter
hereof and there are no other agreements or understandings, written or oral, in
effect between the parties relating. to such subject matter except as expressly
referred to herein.

<PAGE> 10

6.9 ARBITRATION. Any claim or dispute arising out of or relating to
this Agreement, or the construction, interpretation or breach hereof, shall be
submitted to arbitration in San Francisco, California, in accordance with the
provisions and procedures of the American Arbitration Association and, to the
extent permissible by law, the parties shall be bound by the results thereof;
provided, however, that the Trustee shall have no obligation to initiate any
such proceeding. Judgment upon any award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof.

IN WITNESS WHEREOF, each of the parties hereto has executed
this Agreement as of the date and year first above written.

MERIDIAN POINT REALTY TRUST '83

By: __________________________
Name: Lorraine O. Legg
Title: President and Chief Executive Officer

U.S. TRUST COMPANY, N.A.

By: _________________________
Name: Sandra H. Leess
Title: Senior Vice President

<PAGE> 11

EXHIBIT "A"

LIST OF INDEMNITY AGREEMENTS
----------------------------

Indemnity Agreement dated April 8, 1988, between Sierra Real Estate Equity Trust
'83 and Herbert E. Stansbury, Jr.

Indemnity Agreement dated as of January 30, 1992, effective as of June 6, 1991,
between Meridian Point Realty Trust '83 and James M. Pollak.

Indemnity Agreement dated as of June 3, 1994, between Meridian Point Realty
Trust '83 and Peter O. Hanson.

Indemnity Agreement dated as of March 4, 1993, between Meridian Point Realty
Trust '83 and Robert E. Morgan.

Indemnity Agreement dated as of October 29, 1993, between Meridian Point Realty
Trust '83 and Lorraine O. Legg.

<PAGE> 12

EXHIBIT "B"

LIST OF AGENTS
--------------

Peter O. Hanson, Trustee
235 Moore Street
Hackensack, NJ 07601

Lorraine O. Legg, President, Chief Executive
Officer and Trustee
Meridian Point Realty Trust '83
655 Montgomery Street, Suite 800
San Francisco, California 94111

Robert E. Morgan, Trustee
7 San Sebastian
Newport Beach, CA 92660

James M. Pollak, Trustee
Post Office Box 1308
Ennis, MT 59729

Herbert E. Stansbury, Jr.
11 LaSalle Avenue
Piedmont, CA 94611

John E. Castello, Executive Vice President,
Chief Financial Officer and Secretary
Meridian Point Realty Trust '83
655 Montgomery Street, Suite 800
San Francisco, California 94111

<PAGE> 13

EXHIBIT "C"

FORM OF REQUEST FOR WITHDRAWAL

U.S. Trust Company, N.A.
515 S. Flower Street, Suite 2700
Los Angeles, California 90071-2291

Pursuant to the Meridian Point Realty Trust '83 Indemnity Trust
Agreement dated as of ________________, 1998 (the "Agreement"), I hereby request
withdrawal of $__________ from the Trust by check payable to __________________
connection with this request, hereby certify as follows:

1. I am identified as an Agent under the Agreement.

2. I have incurred Expenses in the amount of $__________
consisting of ________________ for which I believe in good
faith I am entitled to an advance pursuant to the
Declaration of Trust and/or an Indemnity Agreement.

3. True and complete copies of the bills for such Expenses are
attached hereto.

For purposes of this request, the terms "Agent", "Declaration of
Trust", "Expenses", "Indemnity Agreement" and "Trust" have the meanings given to
them in Section 1 of the Agreement.

IN WITNESS WHEREOF, the undersigned has executed this request as of
this _______ day of _____________ ____, and certifies that the foregoing is true
and correct.

----------------------------------
[Signature]

----------------------------------
[Print Name]

----------------------------------
[Street Address)

----------------------------------
[City, State, Zip Code]

<PAGE> 14

EXHIBIT "E"

SCHEDULE OF TRUSTEE COMPENSATION AND EXPENSES
---------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ACCEPTANCE FEE $500.00
For review and complete analysis of the Agreement and other relevant documents,
meetings and conferences with all parties, execution of documents, attendance at
the closing by the account officer and authentication and delivery of
securities.

ANNUAL ADMINISTRATION FEE $3,500.00
For normal administrative functions as specified in the Agreement, including
maintenance of administrative records and duties in connection with security
provisions. Any extraordinary services will be charged based on the Trustee's
appraisal of the services rendered.

ANNUAL TAX RETURN PREPARATION FEE $ 700.00
For the annual preparation of the tax returns of the Trust. This fee shall be
paid unless the Company elects to prepare the tax returns of the Trust pursuant
to Section 2.5 of the Agreement.

OTHER CHARGES:

Legal Fees AT COST

Purchase, sale, receipt, delivery, maturity or redemption $ 35.00 per transaction
of securities (investment transactions)

Wire transfers $ 25.00 per wire
transfer

Out-of-pocket expenses AT COST
Includes expenses incurred on the Company's behalf such as postage, telephone,
insurance, express mail and messenger charges, travel expenses to attend the
closing or other meetings, etc.
</TABLE>

<ARTICLE> 5

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 600,173
<SECURITIES> 1,205,722
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,178,076
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,178,076
<CURRENT-LIABILITIES> 185,567
<BONDS> 0
0
0
<COMMON> 3,031,618
<OTHER-SE> (1,039,109)
<TOTAL-LIABILITY-AND-EQUITY> 2,178,076
<SALES> 0
<TOTAL-REVENUES> 101,893
<CGS> 0
<TOTAL-COSTS> 914,718
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (812,825)
<INCOME-TAX> 0
<INCOME-CONTINUING> (812,825)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (812,825)
<EPS-PRIMARY> (.27)
<EPS-DILUTED> (.27)

</TABLE>