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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
|X| Annual report pursuant to Section 15(d) of the Securities Exchange
Act of 1934
For the fiscal year ended December 31, 1999 Commission file number ________
BURNHAM PACIFIC OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
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(FULL TITLE OF THE PLAN)
Burnham Pacific Properties, Inc.
(Name of issuer of the securities held pursuant to the plan)
110 West A Street Suite 900, San Diego, California 92101
(address of principal executive offices)
(619) 652-4700
(Telephone No.)
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REQUIRED INFORMATION
Financial statements and exhibit
(a) Financial Statements
These documents are listed in the index to the Financial
Statements
(b) Exhibit
23.1 Independent Auditors' Consent
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
administrators of the Plan have duly caused this annual report to be signed by
the undersigned thereunto duly authorized.
BURNHAM PACIFIC
OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
By: Burnham Pacific Operating
Partnership, L.P.
By: Burnham Pacific
Properties, Inc.,
General Partner
Date: June 27, 2000 By: /s/ J. David Martin
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J. David Martin, Chief Executive Officer
Date: June 27, 2000 By: /s/ Daniel B. Platt
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Daniel B. Platt, Chief Financial Officer
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BURNHAM PACIFIC OPERATING
PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
AND INDEPENDENT AUDITORS' REPORT
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BURNHAM PACIFIC OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
TABLE OF CONTENTS
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<TABLE>
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Page
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INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Assets Available for Benefits as of
December 31, 1999 and 1998 2
Statements of Changes in Assets Available for Benefits for the
Years Ended December 31, 1999 and 1998 3
Notes to Financial Statements 4-9
SUPPLEMENTAL SCHEDULE:
Schedule of Assets Held for Investment Purposes as of
December 31, 1999 10
NOTE: All other schedules required by Department of Labor Rules and
Regulations for Reporting and Disclosure under the Employee Retirement
Income Security Act of 1974 are omitted because of the absence of
conditions under which they are required.
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
Burnham Pacific Operating Partnership, L.P.
401(k) Retirement Savings Plan:
We have audited the accompanying statements of assets available for the benefits
of Burnham Pacific Operating Partnership, L.P. 401(k) Retirement Savings Plan
(the "Plan") as of December 31, 1999 and 1998 and the related statements of
changes in assets available for benefits for the years then ended. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. 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, such financial statements present fairly, in all material
respects, the assets available for benefits of the Plan as of December 31, 1999
and 1998 and the changes in assets available for benefits for the years then
ended in conformity with accounting principles generally accepted in the United
States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents is presented for the purpose of additional analysis and is not
a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule is the responsibility of the Plan's management.
Such supplemental schedule has been subjected to the auditing procedures applied
in our audit of the basic 1999 financial statements and, in our opinion, is
fairly stated in all material respects when considered in relation to the basic
1999 financial statements taken as a whole.
/s/ Deloitte & Touche LLP
San Diego, CA
June 14, 2000
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BURNHAM PACIFIC OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
STATEMENTS OF ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
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<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
ASSETS
Investments $2,241,751 $1,470,871
Receivables:
Employer contributions 5,021 2,937
Participant contributions 16,254 7,758
Investment income receivable 11,297 7,969
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Total receivables 32,572 18,664
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Assets available for benefits $2,274,323 $1,489,535
========== ==========
</TABLE>
See notes to financial statements.
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<PAGE>
BURNHAM PACIFIC OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 1999 AND 1998
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<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
ADDITIONS:
Contributions:
Participant $ 538,345 $ 266,988
Employer 120,411 71,900
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Total contributions 658,756 338,888
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Investment income:
Net appreciation in fair value of investments 152,824 66,410
Dividends and interest 133,068 75,105
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Total investment income 285,892 141,515
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Total additions 944,648 480,403
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DEDUCTIONS:
Benefits paid to participants (159,860) (25,733)
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NET INCREASE 784,788 454,670
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ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 1,489,535 1,034,865
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End of year $2,274,323 $1,489,535
========== ==========
</TABLE>
See notes to financial statements.
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BURNHAM PACIFIC OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATMENTS
DECEMBER 31, 1999 AND 1998
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1. PLAN DESCRIPTION
The following description of Burnham Pacific Operating Partnership, L.P.
401(k) Retirement Savings Plan (the "Plan") is provided for general
information purposes only. Participants should refer to the Plan document
for a more complete description of the Plan's provisions.
GENERAL - The Plan is a defined contribution plan covering all full-time
employees of Burnham Pacific Operating Partnership, L.P. (the "Operating
Partnership"). The Plan provides participants with salary deferral options
pursuant to Section 401(a) of the Internal Revenue Code (the "Code"). The
Plan is administered by the Operating Partnership. Plan assets are held by
Wells Fargo Bank, N.A. (the "Trustee"). The Plan is subject to the
provisions of the Employer Retirement Income Security Act ("ERISA") and the
rules and regulations of the Securities and Exchange Commission.
ELIGIBILITY - The Plan was amended effective July 1, 1999 to change the
eligibility requirements. Prior to the amendment, employees who had
completed six months of service were eligible to join the Plan and
participants could join on January 1 or July 1. The amended Plan allows
full-time employees who have completed three months of service and are 21
years of age to join the Plan. Participants may join on January 1, April 1,
July 1, or October 1.
CONTRIBUTIONS - Active participants may contribute up to 15% of pre-tax,
eligible compensation as defined in the Plan, subject to limitations
imposed by the Code. The Operating Partnership matches 50% of pre-tax
contributions made by active participants who are officers, and 75% of the
contributions made by active participants who are non-officers of the
Operating Partnership, up to 4% of the participant's pre-tax eligible
compensation. In addition to the matching contribution, the Operating
Partnership may make a discretionary contribution to the Plan out of its
current earnings. During the fiscal years ended December 31, 1999 and 1998,
there were no discretionary contributions made to the Plan.
PARTICIPANT ACCOUNTS - Each participant's account is credited with the
participant's contribution, the employer's contribution and an allocated
share of the Plan's earnings. Allocations of earnings are made by the
Trustee in a non-discriminatory manner and are based on each participant's
investment selection and account balance. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account.
VESTING - Participants are immediately vested in their contributions plus
actual earnings thereon. Participants vest in employer matching and
discretionary contributions plus actual earnings thereon at 20% after one
year of full-time service and 20% for each additional year of service. A
participant is normally 100% vested after five years of credited service.
In addition, a participant is 100% vested upon termination of employment
after attaining normal retirement age and upon death or disability while
employed by the Operating Partnership.
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INVESTMENT OPTIONS - A participant may direct contributions in any of the
following investment options offered by the Trustee:
WELLS FARGO CASH INVESTMENT FUND - Invests in high-quality money market
instruments.
PIMCO TOTAL RETURN FUND II - Invests primarily in investment-grade,
fixed income securities with an average duration between three and six
years.
COLUMBIA BALANCED FUND - Invests primarily in common stocks and
investment-grade fixed income securities.
WELLS FARGO S&P 500 STOCK FUND - Invests in the S&P 500 Stock Index
stocks in substantially the same percentages as the S&P 500 Index.
JANUS FUND - Invests primarily in common stock of companies of any
size.
Plan participants may also elect to invest in the common stock of Burnham
Pacific Properties, Inc. ("Burnham Pacific") which is readily tradable on
the New York Stock Exchange. Employee contributions designated to be
invested in Burnham Pacific common stock are held in the Burnham Pacific
Liquidity Fund until the last day of each quarter when the Trustee has been
instructed to purchase the Burnham Pacific common stock. Funds held in the
Burnham Pacific Liquidity Fund are invested in high-quality money market
investments. Effective December 1, 1999, the Trustee can invest in Burnham
Pacific common stock upon receipt of the funds designated for such
investment.
PARTICIPANT LOANS - Participants may borrow from their accounts at a
minimum of $1,000 up to $50,000 but not to exceed 50% of the vested account
balance. Loan repayment terms cannot exceed five years unless the proceeds
are used to construct or purchase the participant's primary residence.
Loans are secured by the participant's account balance and bear interest at
the prime interest rate as of the date of the loan application. Principal
and interest is repaid ratably through payroll deductions. During the
fiscal year ended December 31, 1999 and 1998, interest rates on outstanding
loans ranged from 7.75% to 9.75% and 8.25% to 9.75%, respectively.
PAYMENT OF BENEFITS - Participants are entitled to a distribution of their
vested benefits in the event of retirement, death, disability, termination
of employment or termination of the Plan. Participants may elect to receive
benefit payments in a single lump sum, in monthly installments over a
specified period of time, or in the form of an annuity. Effective July 1,
1998, the Plan was amended to allow participants to request a distribution
in the form of full shares of Burnham Pacific stock to the extent of the
stock included in the participant's account balance.
FORFEITURES - The non-vested balance of a terminated participant's account
is forfeited when a distribution of vested benefits is made. Related
forfeitures are used to reduce employer contributions unless the Operating
Partnership directs the Trustee to use all or a portion of the total
forfeitures to pay for Plan expenses. During 1999 and 1998, employer
contributions were reduced by $8,867 and $0, respectively, from forfeited
nonvested accounts. At December 31, 1999 and 1998, forfeited nonvested
accounts totaled $17,687 and $8,867, respectively.
PLAN EXPENSES - Administrative expenses, investment management fees and
trustee fees are paid by the Operating Partnership unless specified to be
paid by the Plan as described above. Under this arrangement, total fees
paid by the Operating Partnership to the Trustee were $5,103 and $4,686 for
the years ended December 31, 1999 and 1998, respectively.
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PLAN TERMINATION - Although it has not expressed any intent to do so, the
Operating Partnership has the right to discontinue contributions and
terminate the Plan at any time subject to the provisions of ERISA. In the
event of Plan termination, participants become fully vested in their
accounts.
INCOME TAX STATUS - The Internal Revenue Service issued a determination
letter dated January 7, 1993, stating that the Plan, as then designed, was
in compliance with the applicable requirements of the Code and was exempt
from Federal income taxes. The Plan has been amended since receipt of the
letter; however, the Operating Partnership believes that the Plan is
currently designed and being operated in compliance with applicable
requirements of the Code.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION - The financial statements of the Plan are presented
on the accrual basis of accounting.
ACCOUNTING ESTIMATES - The preparation of the financial statements in
conformity with generally accepted accounting principles requires the
Plan's management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of additions and deductions during the
reporting period. Actual results may differ from those estimates.
PAYMENT OF BENEFITS - Benefit payments to participants are recorded upon
distribution.
INVESTMENT VALUATION AND INCOME RECOGNITION - The Plan's investments in
corporate equity securities and mutual funds are stated at fair value based
on quoted market prices. The investment in the common collective fund is
stated at the fair value, based on quoted market prices, of the underlying
investments.
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3. INVESTMENTS
The following table summarizes the Plan's investments at December 31, 1999
and 1998. Investments which represent 5% or more of the Plan's assets are
separately identified.
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
Investments at fair value:
Cash and cash equivalents:
Wells Fargo Cash Investment Fund $ 228,131 $ -
Stagecoach Prime Money Market Fund - 163,064
Burnham Pacific Liquidity Fund - 17,321
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Total Cash and Cash Equivalents 228,131 180,385
Corporate Equity Securities:
Burnham Pacific Properties, Inc. Common Stock 317,968 326,500
Common Collective Fund:
Wells Fargo S&P 500 Stock Fund 514,764 322,832
Mutual Funds:
Columbia Balanced Fund 305,762 212,236
Janus Fund 773,307 349,242
PIMCO Total Return Fund II 74,377 53,358
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Total Mutual Funds 1,153,446 614,836
Participant Loans 27,442 26,318
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Total Investments $2,241,751 $1,470,871
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</TABLE>
During the years ended December 31, 1999 and 1998, the Plan's investments
appreciated by a net amount of $152,824 and $66,410, respectively. This
appreciation in fair value of the Plan's investments is comprised of the
following:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
1999 1998
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<S> <C> <C>
APPRECIATION (DECREASE) IN FAIR VALUE OF:
Mutual Funds $148,847 $87,647
Common Collective Fund 78,889 62,610
Corporate Equity Securities (74,912) (83,847)
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Net Appreciation $152,824 $66,410
======== =======
</TABLE>
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<PAGE>
4. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of assets available for benefits per the
financial statements to the Form 5500 as of December 31, 1999 and 1998:
<TABLE>
<CAPTION>
DECEMBER 31,
1999 1998
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<S> <C> <C>
Assets available for benefits per the
financial statements $2,274,323 $1,489,535
Less: participant contributions receivable (16,254) (7,758)
employer contributions receivable (5,021) (2,937)
investment income receivable (11,297) (7,969)
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Assets available for benefits per the Form 5500 $2,241,751 $1,470,871
========== ==========
</TABLE>
The following is a reconciliation of participant and employer contributions
per the financial statements to the Form 5500 for the years ended December
31, 1999 and 1998:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
1999 1998
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<S> <C> <C>
Participant contributions per the financial statements $ 538,345 $266,988
Less: participant contributions receivable at
end of year (16,254) (7,758)
Plus: participant contributions receivable at
beginning of year 7,758 10,467
Less: rollover contributions per the Form 5500 (130,069) (61,900)
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Participant contributions per the Form 5500 $ 399,780 $207,797
========= ========
Employer contributions per the financial statements $ 120,411 $ 71,900
Less: employer contributions receivable at
end of year (5,021) (2,937)
Plus: employer contributions receivable at
beginning of year 2,937 3,845
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Employer contributions per the Form 5500 $ 118,327 $ 72,808
========= ========
</TABLE>
The following is a reconciliation of earnings from investments per the
financial statements to the Form 5500 for the years ended December 31, 1999
and 1998:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
1999 1998
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<S> <C> <C>
Dividends and interest per the financial statements $ 133,068 $ 75,105
Less: investment income receivable at end of year (11,297) (7,969)
Plus: investment income receivable at
beginning of year 7,969 -
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Earnings from investments per the Form 5500 $ 129,740 $ 67,136
========= ========
</TABLE>
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<PAGE>
5. SUBSEQUENT EVENT
On March 1, 2000, a number of the Operating Partnership's employees were
transferred to BPP Services, Inc. At that time, BPP Services, Inc. was
added to the Plan and the same benefits are available to employees of both
the Operating Partnership and BPP Services, Inc.
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<PAGE>
BURNHAM PACIFIC OPERATING PARTNERSHIP, L.P.
401(k) RETIREMENT SAVINGS PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1999
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<TABLE>
<CAPTION>
IDENTITY OF ISSUE DESCRIPTION OF INVESTMENT FAIR VALUE
----------------- ------------------------- ----------
<S> <C> <C>
Wells Fargo Cash Investment Fund Cash and Cash Equivalent $ 228,131
*Burnham Pacific Properties, Inc. Corporate Equity Securities
Common Stock 317,968
*Wells Fargo S&P 500 Stock Fund Common Collective Fund 514,764
Columbia Balanced Fund Mutual Fund 305,762
Janus Fund Mutual Fund 773,307
PIMCO Total Return Fund II Mutual Fund 74,377
Participant Loans Loans-interest rates
between 7.75% and 9.75%,
maturities through April
2004 27,442
----------
$2,241,751
==========
</TABLE>
*Party-in-interest
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