SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): March 14, 1996
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VALUE PROPERTY TRUST
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(Exact name of registrant as specified in its charter)
Maryland 1-6613 23-1862664
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
120 Albany Street, 8th Floor
New Brunswick, New Jersey 08901-2163
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (908) 296-3080
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TABLE OF CONTENTS
Item 2. Acquisition or Disposition of Assets
Item 5. Other Events
Item 7. Financial Statements and Exhibits
Signatures
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ITEM 2. Acquisition or Disposition of Assets.
On March 14, 1996, Value Property Trust ( the "Trust") received net
cash proceeds of $44.0 million from the sale of twenty-one commercial mortgage
loans to an unaffiliated third party. The price received for the mortgage loans
was determined through a bid process. Victor Capital Group was retained by the
Trust to act as financial advisor for this transaction. The carrying value of
the loans was $41.7 million.
In the period January 1, 1996 to March 1, 1996, Value Property Trust
received aggregate net cash proceeds of $11.0 million attributable to the
repayment of four commercial loans. These four loans had a carrying value of
$8.8 million.
The Trust's remaining mortgage loan holdings are currently less than
$1.0 million.
While the Trust's Amended and Restated Indenture dated as of September
29, 1995 (the "Indenture") relating to the Trust's outstanding 11.125 percent
Senior Secured Notes due 2002 (the "Senior Secured Notes") requires the Trust to
use the proceeds from asset sales to make a purchase offer to redeem Senior
Secured Notes, the Trust has determined to redeem 100 percent of its outstanding
Senior Secured Notes. See Item 5 below.
In connection with its emergence from Chapter 11 proceedings in
September 1995, the Trust implemented Fresh Start Reporting as provided in
Statement of Position 90-7, "Financial Reporting by Entities in Reorganization
Under the Bankruptcy Code." As a result, gains and losses arising from asset
sales from the held-for-sale category over the twelve months following emergence
from bankruptcy will not be immediately recognized but will adjust the basis of
the remaining assets held for investment.
Item 5. Other Events
On March 28, 1996, Value Property Trust entered into a financing
agreement with BlackRock Capital Finance L.P. The agreement provides for the
issuance of $67.4 million aggregate principal amount of new Floating Rate Senior
Secured Notes to BlackRock Capital. The new Floating Rate Notes will bear
interest at 30 day LIBOR plus 1.375 percent, payable monthly, and will have a
stated maturity date of April 1, 1999. The new Notes are redeemable in whole or
in part prior to maturity without a penalty. The financing is anticipated to be
completed within 45 days.
In conjunction with the financing and in accordance with the terms of
the Trust's Indenture, the Trust has notified the Indenture Trustee that it is
exercising the optional redemption provision in the Indenture. The Trust will
utilize approximately $60.7 million of available cash; which includes $55.0
million of cash proceeds from the transactions discussed in Item 2 above, and
$67.4 million of proceeds from the BlackRock financing to redeem all of the
$110.0 million Senior Secured Notes presently outstanding, pay approximately
$4.1 million of accrued interest, and to prepay an existing $14.0 million
mortgage loan.
Item 7. Financial Statements and Exhibits
(b) Pro Forma Financial Information
The Pro Forma financial information required by this section will be
filed as an amendment to this Form 8-K within 60 days.
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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 thereunto duly authorized.
VALUE PROPERTY TRUST
By: /s/ Robert T. English
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Robert T. English
Chief Financial Officer
(Principal Financial Officer)
DATE: March 29, 1996
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