SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 27, 1996
BANYAN SHORT TERM INCOME TRUST
(Exact name of Registrant as specified in its charter)
Massachusetts 1-8820 36-6801275
(State of or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
incorporation) Number)
150 South Wacker Drive, Suite 2900, Chicago, IL 60606
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 553-9800
ITEM 5. OTHER INFORMATION
On November 27, 1996, the Trust's Board of Trustees terminated the
employment of its President, Leonard G. Levine ("Mr. Levine"), without cause,
pursuant to Mr. Levine's employment agreement dated December 31, 1992. Mr.
Levine's employment as the Trust's President was terminated due to the
completion of the final liquidation of the Trust scheduled for December 16,
1996. The Trust subsequently paid all severance obligations due Mr. Levine
pursuant to the employment agreement in the amount of approximately $46,000.
On December 2, 1996, the Trust sold its 75% general partnership interest
in the Dearborn Park Townhome Partnership (the "Partnership") to Mr. Levine for
net cash proceeds of $100,000. Mr. Levine also provided an indemnity to the
Trust, its officers, trustees and the holders of its beneficial interests for
uninsured project-related liabilities. The Trust determined to sell its
partnership interest in order to accomplish the planned liquidation of the
Trust, as development of the Federal Square project had been completed with only
one townhome unit remaining to be sold. Subsequent to the sale to Mr. Levine,
the Trust has no further interest in the Dearborn Park Townhome Partnership or
the Federal Square Development.
On December 3, 1996 the Trust entered into an agreement to assign the
remainder of its assets (subsequent to the Trust's payment of the shareholders'
final liquidating distribution) including, without limitation, its 3.97 percent
interest in Partners Liquidating Trust ("PLT") a liquidating trust established
for the benefit of the unsecured creditors (including the Trust) of VMS Realty
Partners and its affiliates, to The Oak Realty Group, Inc., ("Oak"). The Trust
assigned its assets, including the specified interest in PLT to Oak in
consideration of Oak's (i) assumption by Oak of all of the Trust's remaining
liabilities, (ii) agreement by Oak to become the Trust's liquidating agent,
(iii) indemnity of the Trust and its officers, trustees and shareholders in
respect of all liabilities (except for claims of shareholders), and (iv)
assumption by Oak of the responsibility of responding to and monitoring any
regulatory or legal inquires of the Trust should any issues arise regarding its
previous operations subsequent to its termination. Oak is a privately-held
corporation wholly owned by Mr. Levine. In addition, Mr. Levine has agreed to
personally guarantee the foregoing indemnity obligations of Oak subject to a
total maximum liability of $100,000. As of September 30, 1996, the Trust had
not accorded any carrying value to its interest in PLT due to uncertainties
regarding the timing and amount of potential recovery, if any. The Trust has no
further interest in PLT.
On December 16, 1996, the Trust paid its final liquidating distribution to
its transfer agent, First Chicago Trust Company of New York ("FCT") in the
amount of $3,333,705, or $0.50 per share. The final liquidating distribution
will be disbursed to each shareholder of record as of December 16, 1996 by FCT
upon such shareholder's relinquishment of their respective certificates of
beneficial interest to FCT for cancellation. The final liquidating distribution
represented the remaining cash balance of the Trust as of September 30, 1996 of
$3,900,230 plus cash received from the sale of its partnership interests in the
Dearborn Park Townhome Partnership of $100,000, and interest and other
miscellaneous income of $101,407 less cash expenditures and miscellaneous
reserves for operating expenses associated with the winding up of the operating
affairs of the Trust of $103,671, payment of a one-time premium in the amount of
$398,215 for trustee and officer insurance, payment of termination and
liquidation costs to the Trust's transfer agent associated with the final
liquidating distribution, cancellation of share certificates, and the required
regulatory management of shareholder records in the amount of $51,200, a
termination fee payable to Banyan Management Corp. of $168,846, and a severance
obligation payable pursuant to the employment contract of Mr. Levine of $46,000.
Liquidating cash distributions which were made in two payments to the Trust's
shareholders totaled $29,669,974 or $4.45 per share. Pursuant to the
disbursement of the final liquidating distribution and payment of the closing
costs of the Trust, the Trust will close its transfer book and other records.
As of December 16, 1996 the Trust has no further assets and no known
liabilities, therefore, there are no further operations of the Trust to be
reported.
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.
Date: December 16, 1996 BANYAN SHORT TERM INCOME TRUST
(Registrant)
By: /s/ Joel L. Teglia
Its: Vice President, Chief Financial
and Accounting Officer
