<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
[X] ANNUAL REPORT PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE YEAR ENDED DECEMBER 31, 1994
Commission File Number 1-9525
-------
INCOME OPPORTUNITY REALTY TRUST
------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
California 94-6578120
- ------------------------------- -------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
10670 North Central Expressway, Suite 300, Dallas, Texas 75231
- -------------------------------------------------------- ----------
(Address of Principal Executive Offices) (Zip Code)
(214) 692-4700
----------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Securities Registered Pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
- ------------------------------ ---------------------------
Shares of Beneficial Interest,
no par value American Stock Exchange
Securities Registered Pursuant to Section 12(g) of the Act:
NONE
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for at least the past 90 days. Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]
As of March 3, 1995, the Registrant had 791,444 shares of beneficial interest
outstanding. Of the total shares outstanding 444,718 were held by other than
those who may be deemed to be affiliates, for an aggregate value of $8,728,000
based on the last trade as reported on the American Stock Exchange on March 3,
1995. The basis of this calculation does not constitute a determination by the
Registrant that all of such persons or entities are affiliates of the
Registrant as defined in Rule 405 of the Securities Act of 1933, as amended.
Documents Incorporated by Reference:
NONE
1
<PAGE> 2
This Form 10-K/A amends the Registrant's annual report on Form 10-K for the
fiscal year ended December 31, 1994 as follows:
ITEM 3. LEGAL PROCEEDINGS - pages 12 and 13
ITEM 5. MARKET FOR THE REGISTRANT'S SHARES OF BENEFICIAL INTEREST AND
RELATED SHAREHOLDER MATTERS - page 15
ITEM 6. SELECTED FINANCIAL DATA - page 16
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS - page 18
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - pages 22, 30, 32, 33,
40, 41 and F-1 through F-11
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND REPORTS ON
FORM 8-K - page 67
<PAGE> 3
ITEM 2. PROPERTIES (Continued)
Mortgage Loans (Continued)
Wraparound Mortgage Loans. A wraparound mortgage loan, sometimes called an
all-inclusive loan, is a mortgage loan having an original principal amount
equal to the outstanding balance under the prior existing mortgage loan(s) plus
the amount actually advanced under the wraparound mortgage loan.
As discussed under Real Estate, above, as of December 31, 1994, the Trust
recorded the insubstance foreclosure of the Cedars Apartments, the collateral
securing a mortgage note receivable.
ITEM 3. LEGAL PROCEEDINGS
Olive Litigation
In February 1990, the Trust, together with CMET, National Income Realty Trust
("NIRT") and TCI, three real estate entities with, at the time, the same
officers, directors or trustees and advisor as the Trust, entered into a
settlement of a class and derivative action entitled Olive et al. v. National
Income Realty Trust et al., pending before the United States District Court for
the Northern District of California and relating to the operation and
management of each of such entities. The Olive Litigation was originally filed
on December 8, 1989 and alleged, among other things, a breach by the Trustees
of the Declaration of Trust, and a breach of trust and a breach of fiduciary
duty owed by the Trustees to the Trust by, among other things, retaining BCM as
the Advisor to the Trust without shareholder approval. The plaintiffs sought
injunctive relief and other appropriate relief from the Court. On April 23,
1990, the Court granted final approval of the terms of the settlement.
On May 4, 1994, the parties entered into a Modification of Stipulation of
Settlement dated April 27, 1994 (the "Modification") which settled subsequent
claims of breaches of the settlement which were asserted by the plaintiffs and
modified certain provisions of April 1990 settlement. The Modification was
preliminarily approved by the court July 1, 1994 and final court approval was
entered on December 12, 1994. The effective date of the Modification was
January 11, 1995.
The Modification, among other things, provided for the addition of three new
unaffiliated members to the Trust's Board of Trustees and set forth new
requirements for the approval of any transactions with affiliates over the next
five years. In addition, BCM, the Trust's advisor, Mr. Phillips and William S.
Friedman, who served as President and Trustee of the Trust until February 24,
1994, President of BCM until May 1, 1993 and director of BCM until December 22,
1989, agreed to pay a total of $1.2 million to the Trust, CMET, NIRT and TCI,
of which the Trust's share is $150,000. The Trust received $12,300 in May
1994. The remaining $137,000 is to be paid in 18 monthly installments which
began February 1, 1995.
Under the Modification, the Trust, CMET, NIRT, TCI and their shareholders
released the defendants from any claims relating to the plaintiffs'
allegations. The Trust, CMET, NIRT and TCI also agreed to waive any demand
requirement for the plaintiffs to pursue claims on behalf of each of them
against certain persons or entities. The Modification also requires that any
shares of the Trust held by Messrs. Phillips, Friedman or their affiliates
shall be (i) voted in favor of the reelection of all current members of the
Trust's Board of Trustees that stand for reelection during the two calendar
years following the effective date of the Modification and (ii) voted in favor
of all new
12
<PAGE> 4
ITEM 3. LEGAL PROCEEDINGS (Continued)
Olive Litigation (Continued)
members of the Trust's Board of Trustees appointed pursuant to the terms of
the Modification that stand for reelection during the three calendar years
following the effective date of the Modification.
Pursuant to the terms of the Modification, any related party transaction which
the Trust may enter into prior to April 27, 1999, will require the unanimous
approval of the Trust's Board of Trustees. In addition, related party
transactions may only be entered into in exceptional circumstances and after a
determination by the Trust's Board of Trustees that the transaction is in the
best interests of the Trust and that no other opportunity exists that is as
good as the opportunity presented by such transaction.
For purposes of the Modification requirements, the term "related party
transaction" means and includes (i) any transaction between or among the Trust
or CMET, NIRT or TCI or any of their affiliates or subsidiaries; (ii) any
transaction between or among the Trust, its affiliates or subsidiaries and the
Advisor, Mr. Phillips, Mr. Friedman or any of their affiliates; and (iii) any
transaction between or among the Trust or any of its affiliates or subsidiaries
and a third party with whom the Advisor, Mr. Phillips, Mr. Friedman or any of
their affiliates has an ongoing or contemplated business or financial
transaction or relationship of any kind, whether direct or indirect, or has had
such a transaction or relationship in the preceding one year.
The Modification requirements for related party transactions do not apply to
direct contractual agreements for services between the Trust and the Advisor or
one of its affiliates (i.e. the Advisory Agreement, Property Management
Contracts, etc.). These agreements require the prior approval by two-thirds of
the Trustees of the Trust, and if required, approval by a majority of the
shareholders. The Modification requirements for related party transactions
also do not apply to joint ventures between or among the Trust and CMET, NIRT
or TCI or any of their affiliates or subsidiaries and a third party having no
prior or intended future business or financial relationship with Mr. Phillips,
Mr. Friedman, the Advisor, or any affiliate of such parties. Such joint
ventures may be entered into on the affirmative vote of a majority of the
Trustees of the Trust.
The Modification also terminated a number of the provisions of the settlement,
including the requirement that the Trust, CMET, NIRT and TCI maintain a Related
Party Transaction Committee and a Litigation Committee of their respective
Boards. The court retained jurisdiction to enforce the Modification.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Trust held its annual meeting of shareholders on March 7, 1995, at which
meeting the Trust's shareholders were asked to consider and vote upon (I) the
election of Trustees of the Trust and (ii) the renewal of the Trust's advisory
agreement with BCM.
At such meeting the Trust's shareholders elected the following individuals as
Trustees of the Trust:
<TABLE>
<CAPTION>
Shares Voting
-------------------------
Withheld
Trustee For Authority
------- --------- -----------
<S> <C> <C>
Geoffrey C. Etnire 576,092 12,723
Harold Furst, Ph.D. 576,063 12,752
John P. Parsons 576,138 12,677
Bennett B. Sims 575,057 13,758
Ted P. Stokely 575,057 13,758
Martin L. White 576,138 12,677
Edward G. Zampa 576,138 12,677
</TABLE>
Also at such meeting the Trust's shareholders approved the renewal of the
Trust's advisory agreement with BCM until the next annual meeting of
shareholders with 558,305 votes for the proposal, 17,214 votes against the
proposal and 13,295 votes abstaining.
13
<PAGE> 5
ITEM 5. MARKET FOR THE REGISTRANT'S SHARES OF BENEFICIAL INTEREST AND
RELATED SHAREHOLDER MATTERS (Continued)
On December 5, 1989, the Trust's Board of Trustees approved a share repurchase
program. The Trust's Board of Trustees has authorized the Trust to repurchase
a total of 100,000 of its shares of beneficial interest pursuant to such
program. Through March 3, 1995, the Trust has repurchased 67,952 shares
pursuant to such program at a cost to the Trust of $1.2 million. The Trust
purchased none of its shares of beneficial interest in 1994 or 1995, through
March 3, 1995.
On March 24, 1989, the Trust distributed one share purchase right for each
outstanding share of beneficial interest of the Trust. On December 10, 1991,
the Trust's Board of Trustees voted to redeem the rights having determined that
the they were no longer necessary to protect the Trust from coercive tender
offers. On February 10, 1992, the rights were redeemed, the Trust's
shareholders receiving $.04 for each Right. In connection with such
redemption, Messrs. Phillips and Friedman and their affiliates, who owned
approximately 12% of the Trust's outstanding shares of beneficial interest at
the time, agreed not to acquire more than 40% of the Trust's outstanding shares
of beneficial interest without the prior action of the Trust's Board of
Trustees to the effect that they do not object to such increased ownership.
In August 1994, Mr. Phillips and his affiliates, primarily ART and TCI, owned
approximately 39.8% of the Trust's outstanding shares of beneficial interest.
This shareholder group desired to purchase additional shares of the Trust and
requested that the Trust's Board of Trustees consider the elimination of the
limitations on the percentage of shares which may be acquired by the
shareholder group. The Board of Trustees reviewed the limitation and
determined that, due to the fact that Mr. Friedman is no longer affiliated with
the shareholder group, and had disposed of any shares of the Trust which he or
his affiliates may have owned, the limitation should no longer apply to Mr.
Friedman or his affiliates. The Board of Trustees also determined that there
was no reason to object to the purchase of additional shares of the Trust by
the shareholder group and on August 23, 1994, the Trust's Board of Trustees
adopted a resolution to the effect that they do not object to the acquisition
of up to 49% of the Trust's outstanding shares of beneficial interest by Mr.
Phillips and his affiliates. In determining total ownership, shares of
beneficial interest of the Trust owned by Mr. Friedman, if any, are no longer
to be included. Pursuant to this action, Mr. Phillips and his affiliates may
not acquire more than 49% of the Trust's outstanding shares of beneficial
interest without the prior action of the Trust's Board of Trustees to the
effect that they do not object to such increased ownership. At March 3, 1995,
Mr. Phillips and his affiliates, primarily ART and TCI, owned approximately
44% of the Trust's outstanding shares of beneficial interest.
15
<PAGE> 6
ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------------------------------------------------------------------------
1994 1993 1992 1991 1990
------------ ------------- ------------- -------------- --------------
(dollars in thousands, except per share)
<S> <C> <C> <C> <C> <C>
EARNINGS DATA
Income................... $ 6,938 $ 7,316 $ 6,619 $ 5,592 $ 8,463
Expense.................. 7,225 7,247 7,089 14,645 17,552
------------ ------------- ------------- -------------- --------------
Income (loss) before
(loss) on sale of
real estate and
extraordinary gain...... (287) 69 (470) (9,053) (9,089)
(Loss) on sale of real
estate.................. - - (81) - -
Extraordinary gain....... - 806 - 4,765 -
------------ ------------- ------------- -------------- --------------
Net income (loss)........ $ (287) $ 875 $ (551) $ (4,288) $ (9,089)
============ ============= ============= ============== ==============
PER SHARE DATA
Income (loss) before
extraordinary gain...... $ (.36) $ .09 $ (.64) $ (9.97) $ (9.79)
Extraordinary gain....... - 1.00 - 5.25 -
------------ ------------- ------------- -------------- --------------
Net income (loss)........ $ (.36) $ 1.09 $ (.64) $ (4.72) $ (9.79)
============ ============= ============= ============== ==============
Distributions per share.. $ .60 $ .50 $ - $ 1.44 $ .88
Weighted average
shares outstanding...... 791,444 804,716 864,321 907,665 928,606
</TABLE>
<TABLE>
<CAPTION>
December 31,
---------------------------------------------------------------------------------
1994 1993 1992 1991 1990
------------ ------------- ------------- -------------- --------------
(dollars in thousands, except per share)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA
Notes and interest
receivable.............. $ 1,974 $ 2,983 $ 2,922 $ 2,583 $ 28,850
Real estate held for
sale.................... 41,035 40,831 41,646 43,779 34,331
Total assets............. 49,035 50,127 51,275 52,401 75,631
Notes and interest
payable................. 20,717 21,354 22,447 22,651 40,798
Redeemable shares of
beneficial interest..... - - - 6,062 6,062
Shareholders' equity..... 25,572 26,334 26,380 20,904 25,574
Book value per share..... $ 32.31 $ 33.27 $ 30.52 $ 30.14 $ 34.00
</TABLE>
Shares and per share data have been restated to give effect to the one-for-four
reverse share split effected September 9, 1991.
16
<PAGE> 7
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Liquidity and Capital Resources (Continued)
On a quarterly basis, the Trust's management reviews the carrying values of the
Trust's mortgage notes receivable and properties. Generally accepted
accounting principles require that the carrying value of an investment cannot
exceed the lower of its cost or its estimated net realizable value. In those
instances in which estimates of net realizable value of the Trust's properties
or notes are less than the carrying value thereof, at the time of evaluation, a
provision for loss is recorded by a charge against earnings. Estimated net
realizable value of mortgage notes receivable is based on management's review
and evaluation of the collateral properties securing such notes. The property
review generally includes selective property inspections, a review of the
property's current rents compared to market rents, a review of the property's
expenses, a review of maintenance requirements, discussions with the manager of
the property and a review of properties in the surrounding area.
Results of Operations
1994 COMPARED TO 1993. For the year 1994, the Trust had a net loss of
$287,000, as compared with net income of $875,000 in 1993. The Trust's 1993
net income included an extraordinary gain of $806,000 on the early payoff of
mortgage debt. The primary factors contributing to the Trust's 1994 net loss
are discussed in the following paragraphs.
Net rental income (rental income less expenses applicable to rental income)
for 1994 was $3.1 million, as compared to $3.4 million in 1993. A decrease of
$242,000 is due to a decline in occupancy at one of the Trust's commercial
properties and a decrease of $113,000 is due to a decline in occupancy and an
increase in expenses at one of the Trust's apartment complexes. These
decreases are partially offset by an increase in net rental income of $108,000
from increases in occupancy and a decrease in expenses at one of the Trust's
other apartment complexes. Net rental income is expected to increase in 1995
due to anticipated increases in rental and occupancy rates and from obtaining
the Cedars Apartments, the collateral securing a note receivable. The
property was recorded as an insubstance foreclosure as of December 31, 1994
with title to the property being received on March 2, 1995.
Equity in income of partnerships was $86,000 in 1994, as compared to $203,000
in 1993. The decrease is attributable to an increase in repair expenses
representing the deductible portion of a fire loss at one of the Tri-City
apartment complexes.
Interest income of $294,000 for 1994 approximated the $308,000 in 1993.
Interest income in 1995 is expected to decrease due to the insubstance
foreclosure as of December 31, 1994, of the Cedars Apartments, the collateral
securing one of the Trust's mortgage notes receivable. See NOTE 2. "NOTES AND
INTEREST RECEIVABLE."
Interest expense of $1.9 million in 1994 approximated the $1.8 million in 1993.
18
<PAGE> 8
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
------
<S> <C>
INCOME OPPORTUNITY REALTY TRUST
-------------------------------
Report of Independent Certified Public Accountants............ 23
Consolidated Balance Sheets -
December 31, 1994 and 1993.................................. 24
Consolidated Statements of Operations -
Years Ended December 31, 1994, 1993 and 1992................ 25
Consolidated Statements of Shareholders' Equity -
Years Ended December 31, 1994, 1993 and 1992................ 26
Consolidated Statements of Cash Flows -
Years Ended December 31, 1994, 1993 and 1992................ 27
Notes to Consolidated Financial Statements.................... 29
Schedule III - Real Estate and Accumulated Depreciation....... 41
Schedule IV - Mortgage Loans on Real Estate.................. 43
TRI-CITY LIMITED PARTNERSHIP
----------------------------
Report of Independent Certified Public Accountants............ F- 1
Balance Sheets - December 31, 1994 and 1993................... F- 2
Statements of Operations -
Years ended December 31, 1994, 1993 and 1992................ F- 3
Statements of Partners' Equity -
Years ended December 31, 1994, 1993 and 1992................ F- 4
Statements of Cash Flows -
Years ended December 31, 1994, 1993 and 1992................ F- 5
Notes to Financial Statements................................. F- 6
Schedule III - Real Estate and Accumulated Depreciation....... F-10
</TABLE>
All other schedules are omitted because they are not required, are not
applicable or the information required is included in the Consolidated
Financial Statements or the notes thereto.
22
<PAGE> 9
INCOME OPPORTUNITY REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
complete or improve, hold and dispose. The cost of funds, one of the criteria
used in the calculation of estimated net realizable value (approximately 4.8%
and 4.1% as of December 31, 1994 and 1993, respectively) is based on the
average cost of all capital. The provision for losses is based on estimates,
and actual losses may vary from current estimates. Such estimates are reviewed
periodically, and any additional provision determined to be necessary is
charged against earnings in the period in which it becomes reasonably
estimable.
Foreclosed real estate held for sale. Foreclosed real estate is initially
recorded at new cost, defined as the lower of original cost or fair value minus
estimated costs of sale. After foreclosure, the excess of new cost, if any,
over fair value minus estimated costs of sale is recognized in a valuation
allowance. Subsequent changes in fair value either increase or decrease such
valuation allowance. See "Allowance for estimated losses" above. Properties
held for sale are depreciated in accordance with the Trust's established
depreciation policies. See "Real estate and depreciation" below.
Real estate held for sale and depreciation. Real estate is carried at the
lower of cost or estimated net realizable value, except for foreclosed
properties held for sale, which are recorded initially at the lower of original
cost or fair value minus estimated costs of sale. Depreciation is provided for
by the straight-line method over the estimated useful lives of the assets,
which range from 3 to 40 years.
Present value discounts. The Trust provides for present value discounts on
notes receivable that have interest rates that differ substantially from
prevailing market rates and amortizes such discounts by the interest method
over the lives of the related notes. The factors considered in determining a
market rate for notes receivable include the borrower's credit standing, nature
of the collateral and payment terms of the note.
Revenue recognition on the sale of real estate. Sales of real estate are
recognized when and to the extent permitted by Statement of Financial
Accounting Standards No. 66, "Accounting for Sales of Real Estate" ("SFAS No.
66"). Until the requirements of SFAS No. 66 for full profit recognition have
been met, transactions are accounted for using either the deposit, the
installment sale, the cost recovery or the financing method, whichever is
appropriate.
Investment in noncontrolled partnerships. The Trust uses the equity method to
account for investments in partnerships which it does not control. Under the
equity method, the Trust's initial investment, recorded at cost, is increased
by the Trust's proportionate share of the partnership's operating income and
additional advances and decreased by the Trust's proportionate share of the
partnership's operating losses and distributions received.
30
<PAGE> 10
INCOME OPPORTUNITY REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 2. NOTES AND INTEREST RECEIVABLE (Continued)
purchase money financing in the form of a wraparound mortgage note for the
remainder of the purchase price. The Trust incurred a loss on the sale of
$81,000 in excess of the amount previously provided. The mortgage note was
non-interest bearing through May 1, 1993 and thereafter bore interest at 10%
per annum through May 1, 1994, the maturity date of the note. In November
1993, the Trust placed the $1.1 million wraparound mortgage note on
nonperforming, nonaccrual status. In December 1993, the borrower filed for
bankruptcy protection. The Trust accepted a deed in lieu of foreclosure on
March 2, 1995. The Trust recorded the property as an insubstance foreclosure
as of December 31, 1994. The Trust did not incur a loss on foreclosure as the
fair value of the property, less estimated costs of sale, exceeds the principal
balance of the note receivable.
NOTE 3. REAL ESTATE HELD FOR SALE AND DEPRECIATION
As further described in NOTE 1. "SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
Organization and Trust business", the Trust is scheduled, unless and until the
shareholders decide on a contrary course of action, to begin liquidation of its
assets prior to October 24, 1996 and to distribute to its shareholders the net
cash proceeds from the sale or refinancing of equity investments received by
the Trust. Accordingly, the Trust has classified all of its properties as held
for sale in the accompanying Consolidated Balance Sheets.
As discussed in NOTE 2. "NOTES AND INTEREST RECEIVABLE", as of December 31,
1994, the Trust recorded the insubstance foreclosure of the Cedars Apartments.
NOTE 4. ALLOWANCE FOR ESTIMATED LOSSES
Activity in the allowance for estimated losses was as follows:
<TABLE>
<CAPTION>
1994 1993 1992
--------- --------- --------
<S> <C> <C> <C>
Balance January 1,.......... $ 121 $ 121 $ 532
Amounts charged off........ - - (411)
--------- --------- --------
Balance December 31,........ $ 121 $ 121 $ 121
========= ========= ========
</TABLE>
NOTE 5. INVESTMENT IN EQUITY METHOD PARTNERSHIPS
The Trust's investments in equity method partnerships consisted of the
following:
<TABLE>
<CAPTION>
1994 1993
--------- --------
<S> <C> <C>
Tri-City Limited Partnership ("Tri-City")... $ 2,852 $ 3,026
Nakash Income Associates ("NIA")............ 1,128 1,131
--------- --------
$ 3,980 $ 4,157
========= ========
</TABLE>
32
<PAGE> 11
INCOME OPPORTUNITY REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 5. INVESTMENT IN EQUITY METHOD PARTNERSHIPS (Continued)
The Trust uses the equity method to account for its investment in Tri-City, a
36.3% owned limited partnership, and in NIA, a 40% owned partnership.
In June 1989, the Trust issued to F. C. MacArthur, Inc. ("MacArthur"), a
wholly-owned subsidiary of Collecting Bank, N.A. (a national bank in
liquidation), 170,750 of its shares of beneficial interest with a market value
at the date of issuance of $6.1 million, in exchange for a 36.3% general
partner interest in Tri-City, which owns and operates five properties in Texas.
Transcontinental Realty Investors, Inc. ("TCI") with a 23.6% general partner
interest is the other general partner in Tri-City. In November 1992, TCI
purchased MacArthur's 40.1% limited partner interest in Tri-City increasing its
ownership interest to 63.7%. Also in November 1992, TCI acquired all of the
shares of beneficial interest of the Trust owned by MacArthur. As of March 3,
1995, TCI owned approximately 22% of the Trust's outstanding shares of
beneficial interest.
In September 1989, the Trust acquired a 40% interest in the NIA partnership
from Nakash Brothers Realty in exchange for 50,000 of its shares of beneficial
interest with a market value at the date of issuance of $1.3 million, cash of
$800,000 and a contribution of property and notes with a carrying value of
$462,000. In addition, 12,500 of the Trust's shares of beneficial interest
were issued to consultants for services provided in connection with the
acquisition of the partnership interest. In February 1993, the Trust purchased
the 62,500 shares of beneficial interest for a total purchase price of
$375,000. TCI owns the remaining 60% interest in NIA.
Set forth below are summarized financial data for the partnerships the Trust
accounts for using the equity method:
<TABLE>
<CAPTION>
1994 1993
----------- ----------
<S> <C> <C>
Notes receivable............................ $ 4,099 $ 4,099
Real estate, net of accumulated
depreciation ($2,586 in 1994 and $1,982
in 1993)................................... 10,757 11,132
Other assets................................ 194 307
Notes payable............................... (2,634) (2,699)
Other liabilities........................... (520) (423)
----------- ----------
Partners' capital........................... $ 11,896 $ 12,416
=========== ==========
</TABLE>
<TABLE>
<CAPTION>
1994 1993 1992
---------- ----------- ----------
<S> <C> <C> <C>
Rental income................ $ 2,380 $ 2,409 $ 2,369
Interest income.............. 349 397 988
Interest expense............. (283) (317) (904)
Property operations.......... (1,656) (1,528) (1,666)
Depreciation expense......... (605) (583) (516)
Provision for losses......... - - (263)
---------- ----------- ----------
Net income................... $ 185 $ 378 $ 8
========== =========== ==========
</TABLE>
33
<PAGE> 12
INCOME OPPORTUNITY REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 15. COMMITMENTS AND CONTINGENCIES (Continued)
total of $1.2 million to the Trust, CMET, NIRT and TCI, of which the Trust's
share is $150,000. The Trust received $12,300 in May 1994. The remaining
$137,700 is to be paid in 18 monthly installments which began February 1, 1995.
Under the Modification, the Trust, CMET, NIRT, TCI and their shareholders
released the defendants from any claims relating to the plaintiffs'
allegations. The Trust, CMET, NIRT and TCI also agreed to waive any demand
requirement for the plaintiffs to pursue claims on behalf of each of them
against certain persons or entities. The Modification also requires that any
shares of the Trust held by Messrs. Phillips, Friedman or their affiliates
shall be (i) voted in favor of the reelection of all current members of the
Trust's Board of Trustees that stand for reelection during the two calendar
years following the effective date of the Modification and (ii) voted in favor
of all new members of the Trust's Board of Trustees appointed pursuant to the
terms of the Modification that stand for reelection during the three calendar
years following the effective date of the Modification.
Pursuant to the terms of the Modification, any related party transaction which
the Trust may enter into prior to April 27, 1999, will require the unanimous
approval of the Trust's Board of Trustees. In addition, related party
transactions may only be entered into in exceptional circumstances and after a
determination by the Trust's Board of Trustees that the transaction is in the
best interests of the Trust and that no other opportunity exists that is as
good as the opportunity presented by such transaction.
For purposes of the Modification requirements, the term "related party
transaction" means and includes (i) any transaction between or among the Trust
or CMET, NIRT or TCI or any of their affiliates or subsidiaries; (ii) any
transaction between or among the Trust, its affiliates or subsidiaries and the
Advisor, Mr. Phillips, Mr. Friedman or any of their affiliates; and (iii) any
transaction between or among the Trust or any of its affiliates or subsidiaries
and a third party with whom the Advisor, Mr. Phillips, Mr. Friedman or any of
their affiliates has an ongoing or contemplated business or financial
transaction or relationship of any kind, whether direct or indirect, or has had
such a transaction or relationship in the preceding one year.
The Modification requirements for related party transactions do not apply to
direct contractual agreements for services between the Trust and the Advisor or
one of its affiliates (i.e. the Advisory Agreement, Property Management
Contracts, etc.). These agreements require the prior approval by two-thirds of
the Trustees of the Trust, and if required, approval by a majority of the
shareholders. The Modification requirements for related party transactions
also do not apply to joint ventures between or among the Trust and CMET, NIRT
or TCI or any of their affiliates or subsidiaries and a third party having no
prior or intended future business or financial relationship with Mr. Phillips,
Mr. Friedman, the Advisor, or any affiliate of such parties. Such joint
ventures may be entered into on the affirmative vote of a majority of the
Trustees of the Trust.
The Modification also terminated a number of the provisions of the settlement,
including the requirement that the Trust, CMET, NIRT and TCI maintain a Related
Party Transaction Committee and a Litigation Committee of their respective
Boards. The court retained jurisdiction to enforce the Modification.
Other Litigation. The Trust is also involved in various other lawsuits arising
in the ordinary course of business. The Trust's management is of the opinion
that the outcome of these lawsuits will have no material impact on the Trust's
financial condition or results of operations.
40
<PAGE> 13
SCHEDULE III
INCOME OPPORTUNITY REALTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1994
<TABLE>
<CAPTION>
Cost
Capitalized
Subsequent to Gross Amounts of Which Carried
Initial Cost to Trust Acquisition at End of Year
------------------------ ------------ -------------------------------------
Building & Building & (1)
Property/Location Encumbrances Land Improvements Improvements Land Improvements Total
- --------------------- ------------ --------- ------------ ------------ ------- ------------ ----------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Properties Held For Sale
- ------------------------
APARTMENTS
- ----------
Cedars................. $ - $ 198 $ 792 $ - $ 198 $ 792 $ 990(2)
Irving, Texas
Eastpoint.............. 1,922 1,181 2,749 321 1,181 3,070 4,251
Mesquite, Texas
Plumtree............... 5,875 1,751 5,038 824 1,751 5,862 7,613
Martinez, California
Treehouse.............. 1,886 375 2,124 185 375 2,309 2,684
San Antonio, Texas
Porticos............... 10,084 2,897 11,588 50 2,897 11,638 14,535
Milwaukee, Wisconsin
OFFICE BUILDINGS
- ----------------
Saratoga............... - 2,577 10,306 388 2,583 10,688 13,271
Saratoga, California
Town Center Plaza...... - 554 2,214 99 554 2,313 2,867
Boca Raton, Florida
---------- --------- --------- -------- ------- --------- ----------
$ 19,767 $ 9,533 $ 34,811 $ 1,867 $ 9,539 $ 36,672 46,211
========== ========= ========= ======== ======= =========
Allowance for estimated
losses............... (121)
----------
$ 46,090
==========
<CAPTION>
Life on Which
Depreciation
In Latest
Statement
Accumulated Date of Date of Operation
Property/Location Depreciation Construction Acquired is Computed
- --------------------- ------------ ------------ -------- ------------
(dollars in thousands)
<S> <C> <C> <C> <C>
Properties Held For Sale
- ------------------------
APARTMENTS
- ----------
Cedars................. $ - 1964 12/94 40 years
Irving, Texas
Eastpoint.............. 998 1985 01/86 5 - 40 years
Mesquite, Texas
Plumtree............... 1,642 1986 02/86 5 - 40 years
Martinez, California
Treehouse.............. 358 1975 09/89 5 - 40 years
San Antonio, Texas
Porticos............... 929 1973 11/91 40 years
Milwaukee, Wisconsin
OFFICE BUILDINGS
- ----------------
Saratoga............... 886 1986 12/91 3 - 40 years
Saratoga, California
Town Center Plaza...... 242 1985 03/91 5 - 40 years
Boca Raton, Florida
-------
$ 5,055
=======
Allowance for estimated
losses...............
</TABLE>
____________________________
(1) The aggregate cost for Federal income tax purposes is $45,587.
(2) An allowance for loss has been provided to reduce the carrying value of
this property to the Trust's estimate of fair value minus estimated costs
of sale.
41
<PAGE> 14
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Partners of
Tri-City Limited Partnership
Dallas, Texas
We have audited the accompanying balance sheets of Tri-City Limited Partnership
as of December 31, 1994 and 1993, and the related statements of operations,
partners equity, and cash flows for the three years in the period ended
December 31, 1994. These financial statements are the responsibility of the
Partnership'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 Tri-City Limited Partnership
at December 31, 1994 and 1993, and the results of its operations and its cash
flows for the three years in the period ended December 31, 1994 in conformity
with generally accepted accounting principles.
BDO Seidman
February 28, 1995
Dallas, Texas
F-1
<PAGE> 15
TRI-CITY LIMITED PARTNERSHIP
BALANCE SHEETS
================================================================================
<TABLE>
<CAPTION>
December 31, 1994 1993
- --------------------------------------------------------------------------------------------------------------
(dollars in thousands)
<S> <C> <C>
ASSETS
Real estate held for investment
Land $ 2,076 $ 2,076
Building and improvements 11,356 11,077
- --------------------------------------------------------------------------------------------------------------
13,432 13,153
Less accumulated depreciation (2,788) (2,134)
- --------------------------------------------------------------------------------------------------------------
10,644 11,019
Cash and cash equivalents 19 228
Other assets (including $411 in 1994 and
$0 in 1993 due from affiliates) 512 187
- --------------------------------------------------------------------------------------------------------------
Total assets $ 11,175 $ 11,434
==============================================================================================================
LIABILITIES AND PARTNERS EQUITY
Accounts payable (including $271 in 1994
and $67 in 1993 due to affiliates) $ 791 $ 490
- --------------------------------------------------------------------------------------------------------------
Commitments and contingencies
- --------------------------------------------------------------------------------------------------------------
Partners equity
Limited Partners 6,698 6,698
General Partners 3,686 4,246
- --------------------------------------------------------------------------------------------------------------
10,384 10,944
- --------------------------------------------------------------------------------------------------------------
Total liabilities and partners equity $ 11,175 $ 11,434
==============================================================================================================
</TABLE>
See accompanying notes to financial statements.
F-2
<PAGE> 16
TRI-CITY LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
================================================================================
<TABLE>
<CAPTION>
Years ended December 31, 1994 1993 1992
- --------------------------------------------------------------------------------------------------------------
(dollars in thousands)
<S> <C> <C> <C>
INCOME
Rentals $ 2,380 $ 2,483 $ 2,386
Other - 100 2
- --------------------------------------------------------------------------------------------------------------
Total revenue 2,380 2,583 2,388
- --------------------------------------------------------------------------------------------------------------
EXPENSES
Property operations (including $86 in
1994, $57 in 1993 and $40 in 1992
to affiliates) 1,572 1,661 1,431
Interest (including $27 in 1993 and $56 in
1992 to affiliates) - 27 56
Depreciation 654 632 564
General and administrative 14 28 47
- --------------------------------------------------------------------------------------------------------------
Total expenses 2,240 2,348 2,098
- --------------------------------------------------------------------------------------------------------------
Net income $ 140 $ 235 $ 290
==============================================================================================================
</TABLE>
See accompanying notes to financial statements.
F-3
<PAGE> 17
TRI-CITY LIMITED PARTNERSHIP
STATEMENTS OF PARTNERS EQUITY
================================================================================
<TABLE>
<CAPTION>
Limited General
Partner Partners Total
- --------------------------------------------------------------------------------------------------------------
(dollars in thousands)
<S> <C> <C> <C>
Balance January 1, 1992 $ 6,698 $ 4,721 $ 11,419
Net income - 290 290
- --------------------------------------------------------------------------------------------------------------
Balance December 31, 1992 6,698 5,011 11,709
Distributions - (1,000) (1,000)
Net income - 235 235
- --------------------------------------------------------------------------------------------------------------
Balance December 31, 1993 6,698 4,246 10,944
Distributions - (700) (700)
Net income - 140 140
- --------------------------------------------------------------------------------------------------------------
Balance December 31, 1994 $ 6,698 $ 3,686 $ 10,384
==============================================================================================================
</TABLE>
See accompanying notes to financial statements.
F-4
<PAGE> 18
TRI-CITY LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
================================================================================
<TABLE>
<CAPTION>
Years ended December 31, 1994 1993 1992
- --------------------------------------------------------------------------------------------------------------
(dollars in thousands)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 140 $ 235 $ 290
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 654 632 564
Increase (decrease) in due to affiliates (207) 153 (104)
Decrease (increase) in other assets 86 (19) (39)
Increase (decrease) in accrued interest - (6) 1
Increase (decrease) in accounts payable 97 33 (37)
- --------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 770 1,060 675
- --------------------------------------------------------------------------------------------------------------
NET CASH USED IN INVESTING ACTIVITIES -
Real estate improvements (279) (274) (328)
- --------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable - - 750
Payoffs on notes payable - (778) (46)
Distributions (700) (1,000) -
- --------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) financing activities (700) (1,778) 704
- --------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents (209) (986) 1,051
Cash and cash equivalents, beginning of period 228 1,214 163
- --------------------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of period $ 19 $ 228 $ 1,214
==============================================================================================================
</TABLE>
See accompanying notes to financial statements.
F-5
<PAGE> 19
TRI-CITY LIMITED PARTNERSHIP
SUMMARY OF ACCOUNTING POLICIES
================================================================================
ORGANIZATION Tri-City Limited Partnership, a Texas partnership was
AND PURPOSE organized on June 29, 1989. The purpose of the
Partnership is to acquire, hold for investment, improve,
lease, operate, and sell or otherwise dispose of real
estate, and to engage in any and all activities related
or incidental thereto.
Income Opportunity Realty Trust (IORT) and
Transcontinental Realty Investors (TCI) are partners in
the Partnership. IORT is a publicly-held real estate
investment trust whose shares are traded on the American
Stock Exchange. TCI is a publicly held real estate
investment trust whose shares are traded on the New York
Stock Exchange. Basic Capital Management, Inc. (BCM)
serves as the advisor to IORT and TCI.
The percentages of ownership of the Partnership are as
follows:
<TABLE>
<CAPTION>
General Limited
Partner Partner Total
----------------------------------------------------
<S> <C> <C> <C>
TCI 23.59% 40.11% 63.7%
IORT 36.30% - 36.3%
----------------------------------------------------
59.89% 40.11% 100.0%
====================================================
</TABLE>
Allocations of profits and distributions are made in
accordance with the partnership agreement.
REAL ESTATE Land, buildings and improvements are stated at the lower
AND of cost or estimated net realizable value.
DEPRECIATION Depreciation is provided on buildings and
improvements using the straight-line method over the
estimated useful lives of forty years for buildings and
four to forty years for improvements. Expenditures for
renewal and betterments are capitalized and repairs and
maintenance are charged against operations as incurred.
F-6
<PAGE> 20
TRI-CITY LIMITED PARTNERSHIP
SUMMARY OF ACCOUNTING POLICIES
================================================================================
CASH AND CASH The Partnership considers all highly liquid debt
EQUIVALENTS instruments purchased with a maturity of three months or
less to be cash equivalents.
INCOME TAXES The Partnership is taxed as such for federal income tax
purposes. The Partnership has no current year income tax
expense or deferred taxes. Taxable income is included
in the respective tax returns of the Partners.
F-7
<PAGE> 21
TRI-CITY LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. RELATED PARTY LOAN FROM AFFILIATE - On July 16, 1992, TCI loaned to
TRANSACTIONS the Partnership $750,000 bearing interest at a rate of
9.5 percent per annum. The loan was paid down to
$704,000 at December 31, 1992. The outstanding loan was
paid off during 1993.
PROPERTY MANAGEMENT FEES - Carmel Realty Service Ltd.
(Carmel), an affiliate of BCM, provides property
management services for a fee of 5 percent of the
monthly gross rents collected on the properties under
its management. Carmel subcontracts with other entities
for property level management services to the
Partnership's apartments at various rates.
LEASING COMMISSIONS - As compensation for providing
leasing and rent-up services for a Partnership property,
Carmel or its affiliates shall be paid a reasonable
leasing commission.
CONSTRUCTION SUPERVISION - As compensation for oversight
of major renovations and refurbishments, Carmel or its
affiliates shall be paid a construction supervision fee.
Fees to BCM and its affiliates are as follows:
<TABLE>
<CAPTION>
1994 1993 1992
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Property management fees * $ 75,367 $ 39,196 $ 24,670
Leasing commissions 3,346 17,946 15,060
Construction supervision
fees 7,780 - -
--------------------------------------------------------------------------------
$ 86,493 $ 57,142 $ 39,730
================================================================================
</TABLE>
* Net of property management fees paid to
subcontractors, other than Carmel.
F-8
<PAGE> 22
TRI-CITY LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
================================================================================
2. FUTURE Future minimum rentals on noncancellable operating
MINIMUM leases, expiring at various dates, as of December 31,
RENTS 1994 are as follows:
<TABLE>
<CAPTION>
Year Amount
-----------------------------------------------------
<S> <C>
1995 $ 1,150,377
1996 987,967
1997 696,535
1998 394,647
1999 294,427
Thereafter 931,950
-----------------------------------------------------
$ 4,455,903
=====================================================
</TABLE>
F-9
<PAGE> 23
TRI-CITY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1994
================================================================================
SCHEDULE III
<TABLE>
<CAPTION>
COST
CAPITALIZED
SUBSEQUENT TO GROSS AMOUNTS AT WHICH CARRIED
INITIAL COST ACQUISITION AT END OF YEAR
------------------------- ------------ ------------------------------------
BUILDING & BUILDING & ACCUMULATED
PROPERTY DESCRIPTION (1) LAND IMPROVEMENTS IMPROVEMENTS LAND IMPROVEMENTS TOTAL (2) DEPRECIATION
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
MacArthur Mills S.C. $ 238,812 $ 1,353,266 $ 1,075,527 $ 264,110 $ 2,403,515 $ 2,667,625 $ 824,085
Oaks of Inwood Apts. 522,157 1,486,137 2,950 522,157 1,344,958 1,867,115 204,743
Inwood Greens Apts. 318,968 956,904 - 318,968 789,947 1,108,915 131,580
Summit at
Bridgewood S.C. 408,430 2,314,436 762,027 408,430 3,076,464 3,484,894 854,637
Chelsea Square S.C. 562,019 3,184,774 556,925 562,019 3,741,699 4,303,718 772,948
- --------------------------------------------------------------------------------------------------------------------
$2,050,386 $ 9,295,517 $ 2,397,429 $ 2,075,684 $11,356,583 $13,432,267 $ 2,787,993
====================================================================================================================
<CAPTION>
LIFE OF WHICH
DEPRECIATION IN
LATEST STATEMENT
DATE OF DATE OF INCOME
PROPERTY DESCRIPTION (1) CONSTRUCTION ACQUIRED IS COMPUTED
- ---------------------------------------------------------------
<S> <C> <C> <C>
MacArthur Mills S.C. 1986 6/89 4-40 years
Oaks of Inwood Apts. 1979 6/89 40 years
Inwood Greens Apts. 1980 6/89 40 years
Summit at
Bridgewood S.C. 1985 6/89 5-40 years
Chelsea Square S.C. 1985 6/89 5-40 years
- ---------------------------------------------------------------
===============================================================
</TABLE>
(1) There are no encumbrances on the properties.
(2) The aggregate cost for federal income tax purposes is approximately
$13,100,000.
F-10
<PAGE> 24
TRI-CITY LIMITED PARTNERSHIP
SCHEDULE III (CONTINUED)
================================================================================
<TABLE>
<CAPTION>
1994 1993 1992
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
RECONCILIATION OF REAL ESTATE
BALANCE at January 1, $ 13,153,708 $ 12,879,047 $ 12,551,048
Additions
Improvements 278,558 274,661 327,999
- -------------------------------------------------------------------------------------------------------------
BALANCE at December 31, $ 13,432,260 $ 13,153,708 $ 12,879,047
=============================================================================================================
RECONCILIATION OF ACCUMULATED DEPRECIATION
BALANCE at January 1, $ 2,134,465 $ 1,502,14 $ 938,162
Additions
Depreciation 653,528 632,318 563,985
- -------------------------------------------------------------------------------------------------------------
BALANCE at December 31, $ 2,787,993 $ 2,134,465 $ 1,502,147
=============================================================================================================
</TABLE>
F-11
<PAGE> 25
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND REPORTS ON
FORM 8-K
(a) The following documents are filed as part of this Report:
1. Consolidated Financial Statements
INCOME OPPORTUNITY REALTY TRUST
Report of Independent Certified Public Accountants
Consolidated Balance Sheets - December 31, 1994 and 1993
Consolidated Statements of Operations -
Years Ended December 31, 1994, 1993 and 1992
Consolidated Statements of Shareholders' Equity -
Years Ended December 31, 1994, 1993 and 1992
Consolidated Statements of Cash Flows -
Years Ended December 31, 1994, 1993 and 1992
Notes to Consolidated Financial Statements
TRI-CITY LIMITED PARTNERSHIP
Report of Independent Certified Public Accountants
Balance Sheets - December 31, 1994 and 1993
Statements of Operations -
Years Ended December 31, 1994, 1993 and 1992
Statements of Shareholders' Equity -
Years Ended December 31, 1994, 1993 and 1992
Statements of Cash Flows -
Years Ended December 31, 1994, 1993 and 1992
Notes to Financial Statements
2. Financial Statement Schedules
INCOME OPPORTUNITY REALTY TRUST
Schedule III - Real Estate and Accumulated Depreciation
Schedule IV - Mortgage Loans on Real Estate
TRI-CITY LIMITED PARTNERSHIP
Schedule III - Real Estate and Accumulated Depreciation
All other schedules are omitted because they are not applicable or because the
required information is shown in the Consolidated Financial Statement or the
Notes thereto.
3. Exhibits
The following documents are filed as Exhibits to this Report:
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- ---------------------------------------------------------------------
<S> <C>
3.0 Second Amended and Restated Declaration of Trust (incorporated by
reference to the Registrant's Current Report on Form 8-K dated
August 14, 1987).
3.1 Amendment No. 1 to the Second Amended and Restated Declaration of
Trust (incorporated by reference to the Registrant's Current Report
on Form 8-K dated September 18, 1991).
3.2 Restated Trustees' Regulations dated as of April 21, 1989
(incorporated by reference to the Registrant's Current Report on
Form 8-K dated May 9, 1989).
</TABLE>
67
<PAGE> 26
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit Numbered
Number Description Page
- ------- --------------------------------------------------------------------- ------------
<S> <C> <C>
3.0 Second Amended and Restated Declaration of Trust (incorporated by
reference to the Registrant's Current Report on Form 8-K dated
August 14, 1987).
3.1 Amendment No. 1 to the Second Amended and Restated Declaration of
Trust (incorporated by reference to the Registrant's Current Report
on Form 8-K dated September 18, 1991).
3.2 Restated Trustees' Regulations dated as of April 21, 1989
(incorporated by reference to the Registrant's Current Report on
Form 8-K dated May 9, 1989).
</TABLE>
