UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
---------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) November 9, 1999
NOONEY REALTY TRUST, INC.
(Exact Name of Registrant as Specified in its Charter)
MISSOURI 00-13457 48-1339136
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
1100 Main, Suite 2100, Kansas City, MO 64105
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (816) 421-4670
<PAGE>
Item 1. Changes in Control of Registrant.
Settlement Agreement
On October 19, 1999, the Trust entered into a Settlement Agreement (the
"Settlement Agreement") relating to a lawsuit filed in the Circuit Court of
Jackson County, Missouri on August 18, 1997 by the Trust entitled Nooney Realty
Trust, Inc. v. David Johnson, et al. (the "Lawsuit"). The closing under the
Settlement Agreement occurred on November 9, 1999 (the "Closing").
The Lawsuit was filed by the Trust. Among other claims, the Trust had asked
for a declaratory judgment against certain individuals and entities who hold
shares of the Trust. The Trust initiated the suit to obtain a judicial
determination of the validity and status of some of the Trust's shares (known as
"Excess Shares"). On April 27, 1999, the Court entered summary judgment for the
defendants on the Trust's declaratory judgment count and designated its decision
for appeal without awaiting resolution of the Trust's remaining claims. Prior to
the settlement, the Trust had appealed the Court's judgment to the Missouri
Court of Appeals for the Western District.
Pursuant to the Settlement Agreement, (i) CGS Real Estate Company, Inc.
("CGS") and certain of its affiliates have sold all their shares of common stock
in the Trust owned beneficially or of record by CGS or its affiliates (75,763
shares) to NKC Associates, L.L.C. (37,881) and Chris Garlich (37,882) at a price
of $10.00 per share, (ii) Lawrence E. Fiedler, and James P. Ingram resigned as
members of the Board of Trustees, and each of William J. Carden, Thomas N.
Thurber, Gregory J. Nooney, Jr., Glenda F. White and Patricia A. Nooney resigned
as officers of the Trust effective as of the Closing, (iii) Robert B. Thomson
and Monte McDowell were elected by the Board of Directors to fill the vacancies
created by the resignations of the two members of the Board of Trustees, (iv)
CGS and its affiliates have terminated each of the management and other services
agreements between CGS and its affiliates and the Trust, (v) the Lawsuit was
dismissed pursuant to stipulations of dismissal with prejudice signed by each of
the parties to the Lawsuit and (vi) William J. Carden and Thomas N. Thurber
terminated their employment agreements with the Trust. Mr. Thomson and Mr.
McDowell, along with William W. Geary, Jr., are the Trust's independent
trustees, as required by the Trust's bylaws.
Effective November 9, 1999, the Board of Trustees elected the following
officers: David L. Johnson, Chairman; Daniel W. Pishny, President; John W.
Alvey, Vice-President; Christine A. Robinson, Secretary; and Amy Kennedy,
Treasurer.
The Settlement Agreement also requires that William J. Carden, Gregory J.
Nooney, Jr. and William W. Geary, Jr. resign as members of the Board. However,
Rule 14f-1 of the Securities Exchange Act of 1934 requires that, at least ten
days prior to a change in a majority of the directors, the Trust must file the
information disclosed in this Form 8-K with
2
<PAGE>
the Securities and Exchange Commission and transmit this information to all
shareholders of the Trust. Messrs. Carden, Nooney and Geary will resign
effective as of the expiration of this ten day period. The remaining members of
the Board will appoint David L. Johnson, Daniel W. Pishny and Chris Garlich to
fill the vacancies on the Board created by these resignations at that time. Mr.
Garlich will be the Trust's third independent trustee.
NKC Associates, L.L.C. ("NKC") is a Missouri limited liability company whose
members are: Daniel W. Pishny (22.5%), John W. Alvey (22.5%), Amy Kennedy
(22.5%), Christine A. Robinson (22.5%) and Robert B. Thomson (10%). NKC acts as
a limited partner in real estate limited partnerships. NKC acquired the 37,881
shares of the Trust from CGS with funds from a demand loan made by Bond
Purchase, L.L.C., a Missouri limited liability company and an affiliate of NKC.
The demand loan is secured by the 37,881 shares of the Trust acquired by NKC,
with interest accruing on the unpaid balance at a rate of eight percent per
annum. Chris Garlich acquired the 37,882 shares of the Trust from CGS with
personal funds.
NKC, Chris Garlich, David L. Johnson and the other newly appointed officers
and directors now beneficially own 251,790 shares of the Trust, representing
29.05% of the 866,624 issued and outstanding shares of the Trust as of November
15, 1999.
Directors and Executive Officers
DAVID L. JOHNSON Mr. Johnson, age 43, is Chairman, Chief Executive
Officer, and majority shareholder of Maxus
Properties, Inc. ("Maxus"), a Missouri corporation
located at 1100 Main, Suite 2100, Kansas City,
Missouri 64105, that specializes in commercial
property management for affiliated owners. Maxus
employs more than 250 people to manage 49
commercial properties, including more than 8,000
apartment units and 700,000 square feet of retail
and office space. Mr. Johnson is also currently
Vice President of KelCor, Inc. ("KelCor"), a
Missouri corporation that specializes in the
acquisition of commercial real estate.
DANIEL W. PISHNY Mr. Pishny, age 37, is President and Chief
Operating Officer of Maxus. Mr. Pishny is
responsible for the day-to-day operations of Maxus
and its managed properties. Prior to working for
Maxus, Mr. Pishny worked in Bank Midwest, N.A.'s
commercial lending department as a vice president
of commercial lending.
ROBERT B. THOMSON Mr. Thomson, age 52, is an attorney in private
practice in Kansas City, Missouri. His practice
emphasizes real estate, business and corporate law.
Since 1987, Mr. Thomson has served as a Trustee for
the Kansas City, Missouri Police and Civilian
Retirement
3
<PAGE>
Fund, overseeing investments in excess of one-half
billion dollars.
MONTE MCDOWELL Mr. McDowell, age 42, is currently the President,
Chief Executive Officer and principal shareholder
of Home Medical Speciality Equipment, Inc., a
Missouri corporation doing business as MED4HOME,
which he founded in 1994. This corporation is
involved in capital equipment medical sales.
CHRIS GARLICH Mr. Garlich, age 42, is the Executive Vice
President and member of Bancorp Services, LLC, a
Missouri limited liability company, specializing in
the development, administration and distribution of
life insurance products to the corporate and high
net worth market place.
JOHN W. ALVEY Mr. Alvey, age 41, is Executive Vice President and
Chief Financial Officer of Maxus and President of
KelCor.
Except as described herein, none of the directors or executive officers of
the Trust (i) has engaged in or has a direct or indirect interest in any
transaction or series of transactions since the beginning of the Trust's last
fiscal year or in any currently proposed transaction, to which the Trust or any
of its subsidiaries is a party where the amount involved was in excess of
$60,000, (ii) is the beneficial or record owner of any securities of the Trust
or any parent or subsidiary thereof, (iii) is the record owner of any securities
of the Trust of which it may not be deemed to be the beneficial owner, (iv) has
been within the past year, a party to any contract, arrangement or understanding
with any person with respect to any securities of the Trust, (v) has any
arrangements or understandings with any nominee with respect to any securities
of the Trust pursuant to which such nominee was selected as a nominee and there
exist no such agreements or understandings between any nominee and any other
person, or (vi) has any agreement or understanding with respect to future
employment by the Trust or any arrangement or understanding with respect to any
future transactions to which the Trust will or may be a party.
Each of the nominees has consented to serve as a director and intends to
discharge his duties as director of the Trust in compliance with all applicable
legal requirements, including the general fiduciary obligations imposed upon
corporate directors.
Committees of the Board
Among the standing committees of the Board of Directors are the Executive
Committee and the Audit Committee. The Trust does not have standing nominating
or compensation committees.
4
<PAGE>
Effective after the ten day notice period required by Rule 14f-1, the
Executive Committee will be comprised of David L. Johnson, Monte McDowell and
Robert B. Thomson. The Executive Committee is empowered to exercise, in between
regular meetings of the Board of Directors, all of the authority of the Board of
Directors in the management of the Trust.
Effective after the ten day notice period required by Rule 14f-1, the Audit
Committee will be comprised of Robert B. Thomson, Chris Garlich and Monte
McDowell. The functions of the Audit Committee are to recommend to the Board of
Directors the accounting firm to serve as the independent auditor of the Trust,
to monitor and review with the independent auditor the Trust's financial
reporting and accounting procedures and policies, to supervise the adequacy of
the Trust's financial, accounting and operating controls and to review the scope
of any audits conducted by the independent auditor.
Security Ownership of Certain Beneficial Owners and Management
The table below sets forth information as of November 9, 1999, regarding the
number of shares of the Trust beneficially owned by each of the directors and
executive officers of the Trust and by all directors and executive officers of
the Trust and by all directors and officers as a group. Except for these
directors and executive officers listed below and NKC, the Trust is unaware of
any other beneficial owner of five percent or more of the Trust's shares of
common stock.
<TABLE>
<CAPTION>
<S> <C> <C>
Name of Number of Shares Percent
Beneficial Owner Beneficially Owned (2) of Class (2)
---------------- ---------------------- ------------
David L. Johnson 80,682 (3) 9.3
Daniel W. Pishny 41,981 (4) 4.8
Robert B. Thomson 41,645 (5) 4.8
Chris Garlich 67,082 7.7
Monte McDowell 4,000 (6) *
John W. Alvey 55,881 (4)(7)(8) 6.4
Directors and Executive
Officers as a group 250,790 (9) 28.9
</TABLE>
(1) Under the rules of the Securities and Exchange Commission, persons who have
power to vote or dispose of securities, either alone or jointly with
others, are deemed to be the beneficial owners of such securities.
Accordingly, shares owned separately
5
<PAGE>
by spouses or other family members are not included. Except as described in
the footnotes below, the director has both sole voting power and sole
investment power with respect to the shares set forth in the table.
(2) An asterisk indicates that the number of shares beneficially owned do not
exceed one percent of the Trust's common stock issued and outstanding.
(3) Includes 41,113 shares held by KelCor, Inc., a Missouri corporation owned
by Mr. Johnson and his wife Ms. Sandra Castetter.
(4) Includes shared voting and dispositive power of the 37,881 shares held by
NKC, which each of Mr. Pishny and Mr. Alvey hold a 22.5% equity interest.
(5) These shares are held by FQE, L.L.C., a Missouri limited liability company
("FQE"). FQE obtained the funds used to purchase these shares from proceeds
of a loan made to FQE by David L. Johnson. The loan is evidenced by a
promissory note, due on demand, bearing interest at a rate of eight percent
per annum, and secured by the shares. Mr. Thomson is the sole member of
FQE.
(6) These shares are held by Home Medical Speciality Equipment, Inc., a
Missouri corporation. Mr. McDowell is the principal shareholder and chief
executive officer of this corporation.
(7) Mr. Alvey disclaims any beneficial ownership of the 41,113 shares held by
KelCor,, Inc.
(8) Substantially all of the shares purchased by Mr. Alvey other than the
shares acquired by NKC were purchased with funds loaned to Mr. Alvey by
David L. Johnson and his affiliates. These loans are unsecured.
(9) Includes the 37,881 shares held by NKC.
Management Agreement
The Trust intends to enter into a management agreement with Maxus, which is
an affiliate of Messrs. Johnson, Pishny and Alvey. The terms of the management
agreement will be established at the first board meeting of new directors. The
Trust expects that the management agreement will provide for fees customary to
those in the commercial real estate industry.
6
<PAGE>
Executive Compensation and Directors Fees
No decision has been made as to whether any of the executive officers will be
salaried employees or whether the executive officers will enter into employment
agreements. It is expected that these decisions, along with the decision
regarding whether an investment advisor will be hired, will be made at the first
board meeting of the new directors. It is expected that the independent
directors will be entitled to receive the same fees as the past independent
directors received: (a) $500 for each meeting attended in person; (b) $250 for
each meeting conducted by telephone conference at which a vote was taken; and
(c) reimbursement by the Trust for their expenses and other out-of-pocket
expenses incurred in connection with attending meetings of the Trust and
carrying on the business of the Trust.
Certain Forward Looking Statements
The Shareholder Committee has made forward looking statements in this Proxy
Statement that are subject to risks and uncertainties. Forward looking
statements include those statements preceded by, followed by or that include the
words "believes," "expects," "anticipates" or similar expressions. For those
statements, the Shareholder Committee claims the protection of the safe harbor
for forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Nooney Realty Trust, Inc.
Date: November 16, 1999 By: /s/ Daniel W. Pishny
Daniel W. Pishny, President
7
