<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No._____) *
REALTY REFUND TRUST
- --------------------------------------------------------------------------------
(Name of Issuer)
Shares of Beneficial Interest
- --------------------------------------------------------------------------------
(Title of Class of Securities)
756125 10 0
- --------------------------------------------------------------------------------
(CUSIP Number)
James H. Berick, Esq.
1350 Eaton Center, 1111 Superior Avenue
Cleveland, Ohio 44114 (216) 861-4900
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 16, 1996
-----------------------
(Date of Event which Requires Filing
of this Statement).
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1 (b)(3) or (4), check the following box [ ].
Note: Six Copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-l(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filed out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
(Continued on following page(s))
Page 1 of 5 Pages
--
<PAGE> 2
- ----------------------------- --------------------------
CUSIP No. 756125 10 0 13D Page 2 of 5 Pages
----------------- ----- ----
- ----------------------------- --------------------------
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Harold R. Krause
S.S. No. ###-##-####
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
BK
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) of 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 158,001
SHARES -----------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
EACH N/A
REPORTING -----------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH
158,001
-----------------------------------------------------------
10 SHARED DISPOSITIVE POWER
N/A
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
158,001
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- --------------------------------------------------------------------------------
13 PERCENTAGE OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.48
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
* SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 3
CUSIP No. 756125 10 0 SCHEDULE 13D Page 3 of 5 Pages
Item 1. Security and Issuer
-------------------
This Schedule 13D relates to Shares of Beneficial Interest (the
"Shares") of Realty ReFund Trust, an unincorporated association in the form of a
business trust organized in Ohio under a Declaration of Trust dated April 28,
1971, as amended (the "Issuer"). The address of the principal executive office
of the Issuer is 1385 Eaton Center, 1111 Superior Avenue, Cleveland, Ohio 44114.
Item 2. Identity and Background
-----------------------
(a) This Schedule is being filed by Harold R. Krause (the
"Shareholder").
(b) The Shareholder's business address is 1120 Chester Avenue,
Cleveland, Ohio 44114.
(c) The Shareholder's principal occupations or employment and the name,
principal business and address of any corporation or other organization in which
such employment is conducted is life insurance agent for The New England, 1120
Chester Avenue, Cleveland, Ohio 44114.
(d) The Shareholder has not been convicted of any criminal offense
during the last five years.
(e) The Shareholder has not been a party during the last five years to
any judicial or administrative proceeding resulting in a judgment, decree or
order enjoining future violation of or prohibiting or mandating activities
subject to, federal or state security laws, or finding any violation with
respect to such laws.
(f) The Shareholder is a United States citizen.
Item 3. Source and Amount of Funds or Other Consideration
-------------------------------------------------
Shareholder acquired 158,001 Shares of Beneficial Interest of the
Issuer for an aggregate price equal to $608,304 ($3.85 per Share). The source of
the funds used to pay for these Shares is a loan made in the ordinary course of
business by a bank, as defined in Section 3(a)(6) of the Act (the "Bank").
<PAGE> 4
CUSIP No. 756125 10 0 SCHEDULE 13D Page 4 of 5 Pages
Item 4. Purpose of Transaction
----------------------
The purpose of the purchase reported in this Schedule was to acquire an
interest in the Issuer for investment purposes only. Shareholder reserves the
right to change his plans and intentions at any time, as he deems appropriate.
Item 5. Interest in Securities of the Issuer
------------------------------------
(a) The Shareholder beneficially owns 158,001 Shares,
constituting 15.48% of the outstanding Shares.
(b) The Shareholder has the sole power to vote and dispose of all of
the Shares reported in Item 5(a) as beneficially owned by him.
(c) The only transactions in Shares effected by the Shareholder within
the last sixty days is the purchase of the 158,001 Shares reported herein.
(d) Not applicable.
(e) Not applicable.
<PAGE> 5
CUSIP No. 756125 10 0 SCHEDULE 13D Page 5 of 5 Pages
Item 6. Contracts, Arrangements, Understandings or Relationships with
-------------------------------------------------------------
Respect to Securities of the Issuer
-----------------------------------
There are no contracts, arrangements, understandings or relationships
(legal or otherwise) between the Shareholder and any other person with respect
to any securities of the Issuer.
Item 7. Materials to be Filed as Exhibits
---------------------------------
(a) Form of Promissory Note made by the Shareholder to the
Bank.
Item 8. Signatures
----------
After reasonable inquiry and to the best of my knowledge and belief I
certify that the information set forth in this statement is true, complete and
correct.
Dated: December 24, 1996
/s/ Harold R. Krause
- -----------------------------
Signature
Harold R. Krause
<PAGE> 6
Exhibit (a)
<PAGE> 7
HUNTINGTON COMMERCIAL DRAW NOTE
BANKS CONSUMER PURPOSE
City Office Cleveland Account Number
-------------------------------------- --------------
Division Private Banking Note Number
-------------------------------------- --------------
Branch Private Banking - Cleveland Main (466) (N) Secured (Y/N)
--------------------------------------
Account Name HAROLD R. KRAUSE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
$ 625,000.00 Cleveland, Ohio
---------------- ---------------------- ----------------------
Date
FOR VALUE RECEIVED, the undersigned, jointly and severally if more than
one, promise to pay to the order of The Huntington National Bank (hereinafter
called the "Bank", which term shall include any holder hereof), at such place as
the Bank may designate, or in the absence of such designation, at any of the
Bank's offices, the sum of SIX HUNDRED TWENTY FIVE THOUSAND AND NO/100 - - - - -
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - -
Dollars ($ 625,000.00), or so much thereof as shall have been advanced by the
Bank at any time and not hereafter repaid (hereinafter called the "Principal
Sum") together with interest as hereinafter provided. The undersigned promise to
pay the Principal Sum and the interest thereon at the time(s) and in the
manner(s) hereinafter provided. The proceeds of the loan evidenced hereby may be
advanced in partial amounts during the term hereof and prior to maturity;
provided, that no partial advance of the Principal Sum shall be for less than
$ 1,000.00 and no partial advance shall be made after February 05, 1997. Each
such advance shall be made to the undersigned upon receipt by the Bank of
disbursement instructions and upon receipt, review and approval by the Bank of
the undersigned's application for an advance which shall be in such form and
contain such information as the Bank shall from time to time prescribe. The Bank
shall be entitled to rely on any oral or telephonic communication requesting an
advance and/or providing disbursement instructions hereunder, which shall be
received by it in good faith from anyone reasonably believed by the Bank to be
the undersigned, or the undersigned's authorized agent. The undersigned agree
that all partial advances made and payments received by the Bank will be
evidenced by entries made by the Bank into its electronic data processing system
and/or internal memoranda maintained by the Bank. The undersigned further agree
that the sum or sums shown on the most recent printout from the Bank's
electronic data processing system and/or such memoranda shall be rebuttably
presumptive evidence of the amount of the Principal Sum and of the amount of any
accrued interest. Each request for an advance shall constitute a warranty and
representation by the undersigned that no event of default hereunder or under
any related loan documents has occurred and is continuing and that no event or
circumstance which would constitute such an event of default, but for the
requirement that notice be given or time elapse or both, has occurred and is
continuing.
(This space intentionally left blank)
INTEREST
Prior to maturity, interest will accrue on the unpaid balance of the
Principal Sum from the date hereof (or if marked, ( ) from __________________
______________________________ ) until paid at a variable rate of interest per
annum, which shall change in the manner set forth below equal to 0.0000
percentage points in excess of the Prime Commercial Rate, provided that at no
time shall the rate of interest be less than N/A % per annum nor more than
25.000% per annum.
All interest shall be calculated on the basis of a 360 day year (or, if
marked, ( ) on the basis of a 365 day year (366 days in a leap year)) for the
actual number of days the Principal Sum or any part thereof remains unpaid.
There shall be no penalty for prepayment. The amount of any payment shall first
be applied to the payment of accrued interest which is due.
As used herein, Prime Commercial Rate shall mean the rate established by
the Bank from time to time based on its consideration of economic, money market,
business and competitive factors, and it is not necessarily the Bank's most
favored rate. Subject to any maximum or minimum interest rate limitation
specified herein or by applicable law, any variable rate of interest on the
obligation evidenced hereby shall change automatically without notice to the
undersigned immediately with each change in the Prime Commercial Rate.
(This space intentionally left blank)
MANNER OF PAYMENT
The Principal Sum and any accrued interest shall be due and payable on
FEBRUARY 05, 1997.
Page 1 OF 3
<PAGE> 8
LATE CHARGE
Any installment or other payment not made within 10 days of the date such
payment is due shall be subject to a late charge equal to 5% of the amount of
the installment or payment, but not more than $25.00.
SECURITY
As security for the payment of the obligations evidenced hereby, and of all
other obligations and liabilities of the undersigned, and each of them, to the
Bank, whether now existing or hereafter arising, the undersigned hereby grant
the Bank a security interest in the following property, including all
substitutions and additions thereto, (excluding, however, after-acquired
consumer goods) and the proceeds thereof (all, together with any other property
in which the Bank shall at any time be given a security interest, hereinafter
referred to as the "Collateral"):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
If, at the time of payment and discharge hereof, any of the undersigned shall be
then directly or contingently liable to the Bank as maker, indorser, surety or
guarantor of any other note, bill of exchange, or other instrument, then the
Bank may continue to hold any of the Collateral as security therefor, even
though this Note shall have been surrendered to the undersigned. The Bank shall
not be bound to take any steps necessary to preserve any rights in the
Collateral against prior parties. If any obligation evidenced by this Note is
not paid when due, the Bank may, at its option, demand, sue for, collect or make
any compromise or settlement it deems desirable with reference to the
Collateral, and shall have the rights of a secured party under the law of the
State of Ohio, and the undersigned shall be liable for any deficiency. As to
this Note, the Bank waives the benefit of any security interest given to secure
any other obligation to the Bank of any of the undersigned, unless disclosed on
any federal Truth-in-Lending disclosure statement required to be furnished in
connection with this Note.
DEFAULT
Upon the occurrence of any of the following events:
(1) the undersigned fails to pay any installment when due hereunder
or to perform any obligation of the undersigned to the Bank;
(2) the undersigned fails to do all things necessary to preserve and
maintain the value and collectibility of the Collateral;
(3) any event occurs and continues which constitutes a default by
any of the undersigned under any other obligation to or
agreement with the Bank;
(4) the Collateral declines in value or becomes unsatisfactory to
the Bank and the undersigned fails to furnish immediately upon
demand additional Collateral satisfactory to the Bank;
(5) any guarantor revokes its guaranty, or any event occurs and
continues which constitutes a default by any guarantor under its
guaranty;
(6) the undersigned fails to furnish true and complete financial
statements from time to time on request of the Bank;
(7) the death or dissolution of any of the undersigned, or any
indorser, surety, accommodation party or guarantor;
(8) any representation, warranty or other information given to the
Bank by any of the undersigned, or by any indorser, surety or
guarantor proves to be false, untrue or misleading; or
(9) the Bank for any reason deems itself insecure with respect to
the obligations evidenced hereby;
then Bank may, at its option, without notice or demand, accelerate the maturity
of the obligation evidenced hereby, which obligation shall become immediately
due and payable. In the event the Bank shall institute any action for the
enforcement or collection of the obligations evidenced hereby, the undersigned
agree to pay all costs and expenses of such action, including reasonable
attorneys' fees, to the extent permitted by law.
GENERAL PROVISIONS
All of the parties hereto, including the undersigned, and any indorser,
surety, accommodation party or guarantor, hereby: (1) severally waive
presentment, notice of dishonor, protest, notice of protest, and diligence in
bringing suit against any party hereto; (2) consent that, without discharging or
modifying the duties of any of them and without notice, the Bank may (A) extend
the time of payment and unlimited number of times before or
Page 2 of 3
<PAGE> 9
after maturity, (B) grant any other indulgence at any time and from time to time
to any party hereto, (C) delay in exercising or omit to exercise any right
against, or delay in taking or omit to take any action to collect from or pursue
the Bank's remedies against, any party hereto, (D) release or modify any
collateral, security or guaranties; and (3) severally waive any claim, right or
remedy which such party may now have or hereafter acquire against any other
party or parties hereto that arises hereunder and/or from the performance by
such party hereunder including, without limitation, any claim, remedy or right
of subrogation, reimbursement, exoneration, contribution, indemnification or
participation in any claim, right or remedy of the Bank against the other party
or parties, or any security which the Bank now has or hereafter acquires,
whether such claim, right or remedy arises in equity, under contract, by
statute, under common law or otherwise. The Bank shall not be required to pursue
any party hereto, including any guarantor, or to exercise any rights against any
Collateral herefor before exercising any other such rights.
The obligations evidenced hereby may from time to time be evidenced by
another note or notes given in substitution, renewal or extension hereof. Any
security interest or mortgage which secures the obligations evidenced hereby
shall remain in full force and effect notwithstanding any such substitution,
renewal, or extension.
The captions used herein are for reference only and shall not be deemed a
part of this Note. If any of the terms or provisions of this Note shall be
deemed unenforceable, the enforceability of the remaining terms and provisions
shall not be affected. This Note shall be governed by and construed in
accordance with the law of the State of Ohio.
The undersigned agree that, to the extent that any of the undersigned make
a payment or payments to the Bank, or the Bank receives any proceeds of
Collateral, which payment or payments or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to any of the undersigned, its estate, trustee,
receiver or any other party, including without limitation any guarantor, under
any bankruptcy law, state or federal law, common law or equitable cause, then to
the extent of such payment or repayment, the obligations under this Note or the
part thereof which has been paid, reduced or satisfied by such amount shall be
reinstated and continued in full force and effect as of the date such initial
payment, reduction or satisfaction occurred.
This instrument executed and delivered as of the date first written above.
BORROWER(S):
/s/ Harold R. Krause
- ------------------------------------
Harold R. Krause
Page 3 of 3
