SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarter period ended June 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________________ To ____________________
Commission file number 0-13754
MAXUS REALTY TRUST, INC.
(Exact name of small business issuer as specified in its charter)
Missouri 43-1339136
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
104 Armour, North Kansas City, Missouri 64116
(Address of principal executive offices) (Zip Code)
Trust's telephone number, including area code (816) 303-4500
Indicate by check mark whether the Trust (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Trust was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes [X] No [ ]
1
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INDEX
Page
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS:
Balance Sheet 3
Statements of Operations 4
Statements of Cash Flows 5
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS 7
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS 12
ITEM 2. CHANGES IN SECURITIES 12
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 12
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 12
ITEM 5. OTHER INFORMATION 12
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 13
SIGNATURES 14
EXHIBIT INDEX 15
2
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PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MAXUS REALTY TRUST, INC.
BALANCE SHEET
(UNAUDITED)
June 30, 2000
ASSETS:
Investment property
Land $ 2,080,000
Buildings and improvements 13,758,000
-----------
15,838,000
Less accumulated depreciation (6,046,000)
9,792,000
Investment property held for sale 3,277,000
-----------
Total investment property 13,069,000
Cash 1,255,000
Accounts receivable 293,000
Prepaid expenses and other assets 156,000
Deferred expenses, less accumulated amortization 506,000
-----------
Total assets $ 15,279,000
===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Liabilities:
Mortgage notes payable $ 4,482,000
Accounts payable and accrued expenses 259,000
Real estate taxes payable 212,000
Refundable tenant deposits 67,000
-----------
Total liabilities 5,020,000
-----------
Shareholders' equity:
Common stock, $1 par value: authorized 5,000,000 shares
1,039,624 shares issued and outstanding 1,040,000
Additional paid-in-capital 15,463,000
Distributions in excess of accumulated earnings (6,244,000)
-----------
Total shareholders' equity 10,259,000
-----------
$ 15,279,000
===========
See accompanying notes to financial statements.
3
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MAXUS REALTY TRUST, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2000 1999 2000 1999
Revenues:
Rental $ 671,000 658,000 1,328,000 1,322,000
Other 51,000 101,000 119,000 182,000
---------- ---------- ---------- ----------
Total revenues 722,000 759,000 1,447,000 1,504,000
---------- ---------- ---------- ----------
Expenses:
Depreciation and amortization 126,000 165,000 304,000 356,000
Repairs and maintenance, including common
area maintenance 52,000 82,000 140,000 170,000
Real estate taxes 115,000 190,000 244,000 336,000
Interest, net 90,000 94,000 185,000 187,000
Professional fees 86,000 70,000 189,000 244,000
General and administrative 14,000 109,000 45,000 239,000
Utilities 70,000 62,000 138,000 118,000
Property management fees - related parties 24,000 52,000 49,000 103,000
Other operating expenses 36,000 19,000 80,000 39,000
---------- ---------- ---------- ----------
Total expenses 613,000 843,000 1,374,000 1,792,000
---------- ---------- ---------- ----------
Net income/(loss) $ 109,000 (84,000) 73,000 (288,000)
========== ========== ========== ==========
Per share data (basic and diluted):
Net income/(loss) $ .11 (.10) .08 (.33)
========== ========== ========== ==========
Dividends $ .16 -- .16 --
---------- ---------- ---------- ----------
Weighted average shares outstanding 961,679 866,624 914,151 866,624
========== ========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
4
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MAXUS REALTY TRUST, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
Six Months Ended
June 30, June 30,
2000 1999
Cash flows from operating activities:
Net income (loss) $ 73,000 (288,000)
Adjustments to reconcile net income (loss) to net
cash used in operating activities:
Depreciation and amortization 304,000 356,000
Changes in accounts affecting operations:
Accounts receivable (43,000) (41,000)
Prepaid expenses, other assets and deferred expenses (136,000) (32,000)
Accounts payable and other liabilities (264,000) (80,000)
Deferred compensation -- 123,000
----------- -----------
Net cash provided by (used in) operating activities (66,000) 38,000
----------- -----------
Cash flows from investing activities:
Capital expenditures (49,000) (373,000)
----------- -----------
Cash flows from financing activities:
Principal payments on mortgage notes payable (56,000) (52,000)
Issuance of common stock 1,384,000 --
Dividend paid ($.16 per share) (166,000) --
----------- -----------
Net cash provided by (used in) financing activities 1,162,000 (52,000)
----------- -----------
Net increase (decrease) in cash 1,047,000 (387,000)
Cash, beginning of period 208,000 505,000
----------- -----------
Cash, end of period $ 1,255,000 118,000
=========== ===========
Supplemental disclosure of cash flow information -
cash paid during the quarter for interest $ 190,000 194,000
=========== ===========
</TABLE>
See accompanying notes to financial statements
5
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MAXUS REALTY TRUST, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 2000 AND JUNE 30, 1999
(1) Summary of Significant Accounting Policies
Refer to the financial statements of Maxus Realty Trust, Inc. (formerly Nooney
Realty Trust, Inc.) (the "Trust") for the year ended December 31, 1999, which
are contained in the Trust's Annual Report on Form 10-K, for a description of
the accounting policies which have been continued without change except as noted
below. Also, refer to the footnotes to those statements for additional details
of the Trust's financial condition. The details in those notes have not changed
except as a result of normal transactions in the interim or as noted below. In
the opinion of management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and changes in financial position at June 30, 2000 and for all
periods presented have been made. The results for the six-month period ended
June 30, 2000 are not necessarily indicative of the results which may be
expected for the entire year.
Certain reclassifications have been made to the prior period amounts to conform
to the current period presentation.
(2) Pending Purchase and Sale of Properties
The proceeds of the sale would be used to fund capital improvements, dividends
and potential future acquisitions. On May 3, 2000, the Trust entered into a
letter of intent to sell Franklin Park to an unrelated third party, Chicago
Industrial Partners, L.L.C. ("CIP"). The sale price was $4,525,000 payable in
cash at the closing, subject to any prorations. The Trust must pay the
independent real estate broker a commission of four and three quarters percent
(4.75%) of the total purchase price excluding any prorations or offsets.
The letter of intent is non-binding and was subject to a sale contract being
fully signed by May 22, 2000. As of August 14, 2000, no contract has been
signed. The Trust is continuing negotiations with CIP, as well as other
prospective buyers of the property. The property is classified as held for sale
in the accompanying financial statements for the period ended June 30, 2000.
On July 20, 2000, the Board of Trustees approved the purchase of the North Winn
Apartments ("North Winn") in Kansas City, Missouri. North Winn is located at
4523 N.W. Winn Road in Kansas City, Missouri. North Winn was constructed in
1972, and consists of 109 multi family apartment units. North Winn was 91%
occupied as of April 10, 2000. KelCor, Inc., an affiliate of David L. Johnson,
the Trust's Chairman and trustee, executed an agreement to acquire North Winn.
KelCor, Inc. assigned it's right to acquire North Winn on August 7, 2000 to
North Winn Acquisition, L.L.C., in which the Trust is the sole member and
manager. The Sale Contract is subject to certain provisions, including but not
limited to a thirty (30) day due diligence period. Although there can be no
assurance that this transaction will ultimately be consummated, the closing is
tentatively scheduled to occur in August 2000. The purchase price is $2,725,000.
Funding will be provided by a note from Prudential Multifamily Mortgage, Inc.
for $1,986,000, along with cash on hand in the Trust, and potentially the
unsecured line of credit described in Item 2 Liquidity and Capital Resources.
The loan term is seven years, with monthly payments based on a 30 year
amortization schedule, at an adjustable interest rate of 1.32% over the one
month LIBOR.
(3) Dividends
The Trust paid a $.16 dividend on June 21, 2000. Based upon current information,
it is expected that this dividend will be treated as a return of capital for tax
purposes. However, if results for fiscal 2000 differ significantly from current
projections, the dividend could be treated as taxable income to the Trust's
Shareholders.
6
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ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
This 10-QSB contains forward-looking information (as defined in the Private
Securities Litigation Reform Act of 1995) that involves risk and uncertainty,
including trends in the real estate investment market, projected leasing and
sales, and future prospects for the Trust. Actual results could differ
materially from those contemplated by such statements.
DESCRIPTION OF BUSINESS
Maxus Realty Trust, Inc., a Missouri corporation (formerly Nooney Realty Trust,
Inc.), was formed on June 14, 1984 for the purpose of making equity investments
in income-producing real properties, primarily commercial and light industrial
properties. The Trust's portfolio is comprised of Atrium at Alpha Business
Center, a multi-tenant office building located in Bloomington, Minnesota
("Atrium at Alpha"); Applied Communications, Inc. Office Building, a
single-tenant office building located in Omaha, Nebraska ("ACI Building"); and
Franklin Park Distribution Center, a warehouse and distribution facility in
Franklin Park, Illinois ("Franklin Park"). These properties generated 45%, 42%,
and 14% of total revenues, respectively, for the quarter ended June 30, 2000.
LIQUIDITY AND CAPITAL RESOURCES
Cash on hand as of June 30, 2000, was $1,255,000, an increase of $1,047,000 from
December 31, 1999. The increase in cash is attributable primarily to the
issuance of additional shares of common stock as described in Part II, Item 2-
Changes in Securities. The increase is offset by a reduction in accounts payable
and other liabilities of $264,000. Management believes the Trust's current cash
position and the properties' ability to provide operating cash flow should
enable the Trust to fund anticipated capital expenditures and service debt in
2000. Expenditures for leasing capital are dependent on the timing and actual
dollars negotiated for leases. The anticipated capital expenditures by property
for 2000 are as follows:
OTHER LEASING
CAPITAL CAPITAL TOTAL
Atrium at Alpha............ $18,000 $282,000 $300,000
Franklin Park.............. --- 225,000 225,000
ACI Building............... --- 350,000 350,000
------ -------- --------
$18,000 $857,000 $875,000
The leasing capital expenditures at Atrium at Alpha include tenant alterations
and lease commissions for new and renewal tenants. In addition, the Trust
anticipates spending capital funds for HVAC and minor roof replacements. At
Franklin Park, leasing capital for tenant alterations and lease commissions upon
the leasing of the vacant space is budgeted. At the ACI Building, the single
occupant in the building renewed their lease in 1998. The funds to reimburse the
tenant for certain tenant alterations up to a maximum of $350,000 may be paid
during 2000 or deferred until 2001 depending on when the tenant elects to
perform the work.
The debt on the Trust's properties matures in the year 2001. Management believes
that the Trust will be able to refinance the debt on similar terms at that time.
In August of 2000, $1,986,000 of debt was incurred relative to the acquisition
of a new property, North Winn (as described in Part I- Item 2. Description of
Business). The interest rate is 1.32% over the one month LIBOR, with a term of
seven years and amortization of 30 years. In addition, in August of 2000, the
Trust initiated an unsecured line of credit with Missouri Bank and Trust for
$249,000 at a prime floating rate for a term of six months. As of August 14,
2000, the Trust has not drawn upon this line of credit.
7
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CONTINGENCIES
The Trust's multi-tenant office building located in Bloomington, Minnesota has
been classified in the Minneapolis Airport Committee's (the "MAC") Safety Zone A
in the future expansion of the Minneapolis Airport. The expansion runway is
anticipated to be completed in 2003. The MAC began buying out impacted buildings
during 1999. Safety Zone A is adjacent to the Federal Aviation Authority's noise
buy out zone. The MAC has not indicated whether or not it will buy out the
Trust's building. The Trust is monitoring whether the increased noise from the
new runway will have an impact on future leasing of the building. If the Trust
determines there is a negative impact, the Trust will petition the MAC to buy
the building. If the building continues to be classified in Safety Zone A, it
will be classified as nonconforming use. Given the preliminary state of the
future expansion, management is unable at this time to determine what impact, if
any, this matter will have on the Trust.
RESULTS OF OPERATIONS
The results of operations for the Trust's properties for the three and six
months ended June 30, 2000 and 1999 are detailed in the schedule below.
Administrative expenses, including professional fees, of the Trust are excluded.
FUNDS FROM OPERATIONS
The white paper on Funds from Operations approved by the board of governors of
NAREIT in March 1999 defines funds from operations as net income (loss)(computed
in accordance with GAAP), excluding gains (or losses) from sales of property,
plus real estate related depreciation and amortization, and after adjustments
for unconsolidated partnerships and joint ventures. Adjustment for
unconsolidated partnerships and joint ventures are calculated to reflect funds
from operations on the same basis. In 1999, NAREIT clarified the definition of
Funds from Operations to include non-recurring events, except for those that are
defined as "extraordinary items" under GAAP and gains and losses from sales of
depreciable operating property.
The Trust computes Funds from Operations in accordance with the guidelines
established by the white paper which may differ from the methodology for
calculating Funds from Operations utilized by other equity REITs, and,
accordingly, may not be comparable to such other REITs. Funds from Operations do
not represent amounts available for management's discretionary use because of
needed capital replacement or expansion, debt service obligations, distributions
or other commitments and uncertainties. Funds from Operations should not be
considered as an alternative to net income (determined in accordance with GAAP)
as an indication of the Trust's financial performance or to cash flows from
operating activities (determined in accordance with GAAP) as a measure of the
Trust's liquidity, nor is it indicative of funds available to fund the Trust's
cash needs including its ability to make distributions. The Trust believes Funds
from Operations is helpful to investors as a measure of the performance of the
Trust because, along with cash flows from operating activities, financing
activities and investing activities, it provides investors with an understanding
of the ability of the Trust to incur and service debt and make capital
expenditures.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
ATRIUM AT ALPHA FRANKLIN ACI BUILDING ACI BUILDING
(in thousands)
For the three months ended June 30, 2000 and 1999
2000 Revenues $ 321.7 $ 97.6 $ 302.9
Expenses 254.2 70.1 201.2
------ ------ ------
Net Income 67.5 27.5 101.7
Depreciation and Amortization 70.6 4.0 44.1
------ ------ ------
Funds from Operations 138.1 31.5 145.8
====== ====== ======
</TABLE>
8
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FUNDS FROM OPERATIONS - CONTINUED
<TABLE>
<CAPTION>
<S> <C> <C> <C>
ATRIUM AT ALPHA FRANKLIN PARK ACI BUILDING
(in thousands)
For the three months ended June 30, 2000 and 1999
1999 Revenues $ 321.7 $ 138.4 $ 298.7
Expenses 282.2 192.5 206.3
------- -------- -------
Net Income (loss) 39.5 (54.1) 92.4
Depreciation and Amortization 92.9 36.4 31.0
-------- --------- --------
Funds from Operations 132.4 (17.7) 123.4
======= ======== =======
ATRIUM AT ALPHA FRANKLIN PARK ACI BUILDING
(in thousands)
For the six months ended June 30, 2000 and 1999
2000 Revenues $ 634.3 $ 211.2 $ 601.8
Expenses 529.1 210.8 405.7
-------- ------- ------
Net Income (loss) 104.2 .4 196.1
Depreciation and Amortization 166.0 40.4 89.1
-------- -------- --------
Funds from Operations 271.2 40.8 285.2
======== ======== =======
1999 Revenues $ 669.0 $ 236.0 $ 599.0
Expenses 565.8 345.7 441.2
-------- --------- --------
Net Income (loss) 103.2 (109.7) 157.8
Depreciation and Amortization 188.0 72.8 86.8
--------- ---------- ---------
Funds from Operations 291.2 (36.9) 244.6
========= ========= ========
</TABLE>
COMPARISONS BY PROPERTY
Revenues at the Atrium at Alpha for the quarter ended June 30, 2000 remained
constant with the same period in 1999. Operating expense for the quarter ended
June 30, 2000 decreased $28,000 compared to the same period in 1999. The
decrease in operating expense was primarily due to a decrease in repairs and
maintenance of $11,900 and management fees of $10,300. Revenues at the Atrium at
Alpha for the six months ended June 30, 2000 decreased by $34,700 primarily due
to an increase in vacancy loss of $43,000, a decrease in CAM income of $15,000
and a decrease in other income of $10,000 offset by an increase in rental income
of $37,000.
At Franklin Park, revenues for the three months ended June 30, 2000 decreased
$40,800 compared to the same period in 1999. The decrease in revenue is
primarily due to a decrease in CAM income of $40,000. Operating expense for the
three months ended June 30, 2000 decreased $122,400 compared to the same period
in 1999. The decrease in operating expense was primarily due to a decrease in
management fees of $10,200, decreased real estate taxes of $75,300 and decreased
depreciation of $32,400. The decrease in real estate tax expense was due to a
protest of the tax followed by a reduction in taxable value of the Franklin Park
property due to decreased occupancy. A Letter of Intent to sell Franklin Park
was executed on May 3, 2000. Therefore, the Franklin Park property has been
classified as held for sale. Accordingly, the assets of Franklin Park were
valued at estimated net realizable value. In addition, no depreciation was
recorded for the quarter ended June 30, 2000 for Franklin Park.
9
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COMPARISONS BY PROPERTY - CONTINUED
Revenues at the ACI Building for the three months June 30, 2000 increased $4,200
compared to the same period in 1999. This increase is primarily due to increased
CAM income. Operating expense for the three months ended June 30, 2000 decreased
$5,100 compared to the same period in 1999. The decrease in operating expense
was primarily due to a decrease in management fees of $8,500. Operating expense
for the six months ended June 30, 2000 decreased $35,500 compared to the same
period in 1999. The decrease in operating expense was primarily due to a
decrease in management fees of $15,500 and a decrease in repairs and maintenance
of $11,400. The remainder of the decrease was due to decreases in a number of
expense categories, none of which was significant.
The occupancy levels at June 30 were as follows:
OCCUPANCY LEVELS AT JUNE 30,
2000 1999
Atrium at Alpha 86% 89%
Franklin Park 57% 57%
ACI Building 100% 100%
During the quarter ended June 30, 2000, the occupancy level at Atrium at Alpha
increased from 83% at March 31, 2000 to 86% at June 30, 2000. One new tenant
which occupied 2,083 square feet signed a lease in April of 2000. No tenants
vacated. Four tenants leases expired and were renewed in different suite
configurations for a total of 10,327 square feet, a net increase of 174 square
feet. Two additional tenants renewed their leases for a total of 6,655 square
feet. The property has one major tenant occupying 16% of the building. The lease
for this tenant expires in December 2003.
Franklin Park has one tenant occupying 57% of the building. The lease expires in
December 2004.
The ACI Building has a single tenant occupying 100% of the building. The lease
expires in August 2008.
The Trust reviews long-lived assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of a property may not be
recoverable. The Trust considers a history of operating losses or a change in
occupancy to be primary indicators of potential impairment. The Trust deems the
property to be impaired if a forecast of undiscounted future operating cash
flows directly related to a property, including disposal value, if any, is less
than its carrying amount. If the property is determined to be impaired, the loss
is measured as the amount by which the carrying amount of the property exceeds
its fair value. Fair value is based on quoted market prices in active markets,
if available. If quoted market prices are not available, an estimate of fair
value is based on the best information available, including prices for similar
properties or the results of valuation techniques such as discounting estimated
future cash flows. Considerable management judgment is necessary to estimate
fair value. Accordingly, actual results could vary significantly from such
estimates.
COMPARISON OF CONSOLIDATED RESULTS
For the three months ended June 30, 2000, the Trust's consolidated revenues were
$722,000. Revenues decreased $37,000 (4.9%) compared to the same period in 1999.
The decrease in consolidated revenues is primarily due to an increase in vacancy
loss at the Atrium at Alpha of $43,000 and a decrease in common area maintenance
reimbursement at the Atrium at Alpha of $15,000 and Franklin Park of $40,000.
This decrease was offset in part by an increase in rental revenue at the Atrium
at Alpha building of $37,000 for the same period. The Trust's consolidated
revenue for the six month period ended June 30, 2000 is $1,447,000, a decrease
of $57,000 (3.8%) compared to the same period in 1999. The decrease is primarily
due to the decreases in income described for the quarter ended June 30, 2000,
offset partially by an increase in utilities reimbursement and bad debt
recovery.
10
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COMPARISON OF CONSOLIDATED RESULTS- CONTINUED
For the three months ended June 30, 2000, the Trust's consolidated expenses were
$613,000. Expenses decreased $230,000 (27.3%) compared to the same period in
1999. The decrease in consolidated expenses is due primarily to decreases in
general and administrative expenses of $95,000, real estate taxes of $75,000,
property management fees- related party of $28,000, and depreciation of $39,000.
The decrease in general and administrative expenses was primarily due to a
reduction in payroll expense from previous management. Current management does
not charge payroll expense to the Trust.
The net income for the quarter ended June 30, 2000 was $109,000 or $.11 per
share. The net loss for the quarter ended June 30, 1999 was $84,000 or $.10 per
share.
Cash flow used in operating activities was $66,000 for the period ended June 30,
2000 compared to the same period in 1999, in which cash provided by operating
activities was $69,000. The decrease in cash flow provided by operating
activities was due primarily to decreases in accounts payable and other
liabilities of $264,000. Cash flow used in investing activities was $49,000 for
the period ended June 30, 2000 compared to $373,000 in 1999. The decrease in
cash flow used in investing activities was due primarily to a decrease in
capital expenditures. Cash flow provided by financing activities was $1,162,000
for the period ended June 30, 2000 compared to the same period in 1999, in which
cash used in financing activities was $52,000. The primary cause of the increase
in cash flow provided by financing activities was the $1,384,000 provided by the
issuance of common stock. Reduction of the principal balance on the mortgage
note was the sole use of cash from financing activities for the period ended
June 30, 1999.
MARKET RISK
The Trust has considered the provision of Financial Reporting Release No. 48
"Disclosure of Accounting Policies for Derivative Financial Instruments and
Derivative Commodity Instruments, and Disclosure of Quantitative and Qualitative
Information about Market Risk Inherent in Derivative Financial Instruments,
Other Financial Instruments and Derivative Commodity Instruments". The Trust had
no holdings of derivative financial or commodity instruments at June 30, 2000
The Trust does not believe that it has any material exposure to interest rate
risk. The Debt on the Trust's properties matures in the year 2001. Management
believes that the Trust will be able to refinance the debt on similar terms at
that time.
INFLATION
The effects of inflation did not have a material impact upon the Trust's
operations in the periods ended June 30, 2000.
11
<PAGE>
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
On May 11, 2000, the Trust sold 173,000 shares of its common stock, par value
$1.00 per share, at a price of $8.00 per share, solely to accredited investors
(as such term is defined in Rule 501 of Regulation D) pursuant to a private
placement in accordance with Rule 506 of Regulation D. Each investor executed a
subscription agreement pursuant to which each investor represented and warranted
that such investor met the requirements of an accredited investor. The Trust did
not engage in any form of general solicitation or general advertising in selling
the shares. The shares sold pursuant to the private placement have not been
registered under the Securities Act of 1933, as amended, and may not be offered
or sold in the United States absent registration or an applicable exemption from
registration, and the stock certificates representing such shares contain a
legend with this restriction.
The Trust intends to use the proceeds of the private placement to fund capital
improvements, dividends and potential future acquisitions.
The Trust sold the shares to comply with the listing rules of the Nasdaq
National Market ("Nasdaq"). Nasdaq had previously notified the Trust that the
Trust was not in compliance with two Nasdaq listing requirements. On June 5,
2000, the Trust was granted a qualifications exception by the Nasdaq Listing
Qualifications Panel. The Company has complied with terms of the exception and
therefore the hearing file has been closed by Nasdaq.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On May 9, 2000, the Trust held its Annual Meeting of Shareholders. The results
of the matters submitted to a vote of shareholders were reported on a Form 8-K
(File No. 000-13754) filed by the Trust on May 12, 2000.
ITEM 5. OTHER INFORMATION
On July 20, 2000, the Board of Directors of the Trust declared a cash dividend
of $0.16 per share payable to the holders of record on August 31, 2000 of the
Trust's $1.00 par value, common stock. The Board anticipates that the dividend
will be paid on September 21, 2000. The Trust's Board of Director's has
reinstated the quarterly cash dividend and anticipates declaring a $.16 per
share cash dividend each quarter.
12
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
See Exhibits Index on Page 16
(b) Reports on Form 8-K
The following reports on Form 8-K were filed by the Trust during the second
quarter of 2000:
On May 5, 2000, the Trust filed a report on Form 8-K (File No. 000-13754) which
reported the Trust's execution of a letter of intent to sell one of its
properties (Item 5).
On May 12, 2000, The Trust filed a report on Form 8-K (File No. 000-13754) which
reported the consummation of a private placement, the results of the annual
meeting of the shareholders and the declaration of a dividend (Item 5).
On May 12, 2000, the Trust filed a report on Form 8-K (File No. 000-13754) which
reported the beneficial ownership of the Trust's Common Stock held by the
Trust's management (Item 5).
(The remainder of this page left blank intentionally)
13
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Trust has duly caused this report to be signed on its behalf by
the undersigned, there unto duly authorized.
MAXUS REALTY TRUST, INC.
Date: August 14, 2000 By: /s/ Daniel W. Pishny
Daniel W. Pishny
President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below on August 14, 2000, by the following persons on behalf
of the Trust and in the capacities indicated.
/s/John W. Alvey
John W. Alvey
Vice President
Chief Financial and Accounting Officer
14
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
------ -----------
3.1 Articles of Incorporation dated June 12, 1984, as amended, are
incorporated by reference to Exhibit 3.1 to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2000,
as filed pursuant to Rule 13a-13 under the Securities Exchange Act
of 1934 (File No. 000-13754).
3.2 Bylaws of the Registrant, as amended, are incorporated by reference
to Exhibit 3.2, to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended March 31, 2000, as filed pursuant to Rule 13a-
13 under the Securities Exchange Act of 1934 (File No. 000-13754).
10.1 Assignment of Real Estate Sale Contract dated August 7, 2000 by and
between Kelcor, Inc. and North Winn Acquisition, L.L.C.
27.1 Financial Data Schedule
15
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