<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 6, 1997
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
AMERICAN REALTY TRUST, INC.
(Exact name of Registrant as specified in its Charter)
<TABLE>
<C> <C>
GEORGIA 54-0697989
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
10670 NORTH CENTRAL EXPRESSWAY
SUITE 300
DALLAS, TEXAS 75231
(214) 692-4700
(Address, including zip code, and telephone number, including area code,
of Registrant's principal executive offices)
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ROBERT A. WALDMAN
AMERICAN REALTY TRUST, INC.
10670 NORTH CENTRAL EXPRESSWAY
SUITE 300
DALLAS, TEXAS 75231
(214) 692-4700
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
---------------------
The Commission is requested to send copies of all communications to:
<TABLE>
<C> <C>
THOMAS R. POPPLEWELL ROBERT A. WALDMAN
Andrews & Kurth L.L.P. American Realty Trust, Inc.
1717 Main Street 10670 North Central Expressway
Suite 3700 Suite 300
Dallas, Texas 75201 Dallas, Texas 75231
(214) 659-4480 (214) 692-4700
</TABLE>
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement pursuant to Rule
415.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [X]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
reinvestment plans, please check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==============================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PER SHARE OFFERING PRICE REGISTRATION FEE
- - --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value
$.01 per share.......... 150,000 Shares $14.50(1) $2,175,000(1) $659.09
==============================================================================================================
</TABLE>
(1) Estimated pursuant to Rule 457(c) solely for the purpose of calculating the
amount of the registration fee, based on the average of the high and low
sales prices of the Common Stock, as reported by the New York Stock Exchange
on November 4, 1997.
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<PAGE> 2
PROSPECTUS
AMERICAN REALTY TRUST, INC.
DIVIDEND REINVESTMENT PLAN
American Realty Trust, Inc., a Georgia corporation (the "Company"), hereby
offers participation in its Dividend Reinvestment Plan (the "Plan"). The Plan
provides holders of Common Stock with a convenient and economical method of
reinvesting all or a portion of their cash dividends in additional shares of
Common Stock, in most cases at a discount to the market price.
The Plan allows holders of Common Stock to automatically reinvest cash
dividends on all or a portion of their shares. Shares of Common Stock will be
purchased under the Plan from the Company. The purchase price of the shares of
Common Stock so purchased may reflect a discount (ranging from 0% to 10%) from
the market price.
American Stock Transfer and Trust Company (the "Agent") will act as agent
for the participants in the Plan. The Agent will receive all of the cash
dividends paid on participants' Common Stock and will use such dividends to
acquire shares of Common Stock directly from the Company for the accounts of
such participants.
Any participant in the Plan may withdraw at any time. Holders of Common
Stock who do not choose to participate in the Plan will continue to receive cash
dividends, as declared, in the usual manner.
This Prospectus relates to 150,000 shares of Common Stock of the Company.
The shares of Common Stock of the Company are traded on the New York Stock
Exchange (the "NYSE"). On November 4, 1997, the last sales price for the shares
of Common Stock as reported on the NYSE was $14.50 per share.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR ENDORSED THE
MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE DATE OF THIS PROSPECTUS IS NOVEMBER 6, 1997.
<PAGE> 3
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement under the Securities Act of 1933, as
amended (the "Securities Act") with respect to the securities offered hereby.
This Prospectus does not contain all of the information set forth in such
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. For further information with
respect to the Company and the securities offered hereby, reference is made to
such Registration Statement and to the exhibits thereto. Statements contained
herein concerning the provisions of certain documents are not necessarily
complete and, in each instance, reference is made to the copy of such document
filed as an exhibit to the Registration Statement or otherwise filed with the
Commission. Each such statement is qualified in its entirety by such reference.
The Registration Statement and the exhibits thereto may be inspected without
charge at the office of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, and copies thereof may be obtained from the Commission upon payment of
the prescribed fees.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and, in accordance
therewith, files reports and other information with the Commission. Reports and
proxy and information statements filed by the Company with the Commission
pursuant to the informational requirements of the Exchange Act may be inspected
and copied at the public reference facilities maintained by the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, and at the following regional
offices of the Commission: New York Regional Office, 7 World Trade Center, 13th
Floor, New York, New York 10048; and Chicago Regional Office, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such material may be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. In addition, reports,
proxy statements and other information concerning the Company (symbol: "ARB")
can be inspected and copied at the offices of the New York Stock Exchange, Inc.,
20 Broad Street, New York, New York 10005-2601, on which the Common Stock of the
Company is listed. The Commission also maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants, including the Company, that file electronically with the
Commission. The address of such Web site is "http://www.sec.gov".
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents, heretofore filed by the Company with the
Commission pursuant to the Exchange Act, are hereby incorporated by reference,
except as superseded or modified herein:
1. The Company's Current Report on Form 8-K, dated December 18, 1996, as
filed with the Commission on January 15, 1997.
2. The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, as filed with the Commission on March 31, 1997.
3. The Company's Quarterly Report on Form 10-Q for the fiscal quarter ended
March 31, 1997, as filed with the Commission on May 15, 1997, as amended by the
Company's Form 10-Q/A, as filed with the Commission on August 11, 1997.
4. The Company's Quarterly Report on Form 10-Q for the fiscal quarter ended
June 30, 1997, as filed with the Commission on August 13, 1997.
5. The Company's Current Report on Form 8-K, dated October 16, 1997, as
filed with the Commission on October 24, 1997.
6. The Current Report on Form 8-K for Continental Mortgage and Equity Trust
("CMET") dated December 13, 1996, as filed with the Commission on January 3,
1997, as amended by CMET's Form 8-K/A, as filed with the Commission on February
11, 1997 and by CMET's Form 8-K/A, as filed with the Commission on March 11,
1997.
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<PAGE> 4
7. The Annual Report on Form 10-K for CMET for the year ended December 31,
1996, as filed with the Commission on March 14, 1997.
8. The Quarterly Report on Form 10-Q for CMET for the fiscal quarter ended
March 31, 1997, as filed with the Commission on May 7, 1997.
9. The Current Report on Form 8-K for CMET dated June 24, 1997, as filed
with the Commission on July 9, 1997.
10. The Quarterly Report on Form 10-Q for CMET for the fiscal quarter ended
June 30, 1997, as filed with the Commission on August 8, 1997.
11. The Current Report on Form 8-K for CMET dated August 18, 1997, as filed
with the Commission on October 14, 1997.
12. The Current Report on Form 8-K for CMET dated July 18, 1997, as filed
with the Commission on August 19, 1997.
13. The Annual Report on Form 10-K for Income Opportunity Realty Investors,
Inc. ("IORI") for the year ended December 31, 1996, as filed with the Commission
on March 13, 1997.
14. The Quarterly Report on Form 10-Q for IORI for the fiscal quarter ended
March 31, 1997, as filed with the Commission on May 7, 1997.
15. The Current Report on Form 8-K for IORI dated May 14, 1997, as filed
with the Commission on May 27, 1997.
16. The Current Report on Form 8-K for IORI dated June 11, 1997, as filed
with the Commission on June 27, 1997, as amended by IORI's Form 8-K/A, as filed
with the Commission on August 20, 1997.
17. The Quarterly Report on Form 10-Q for IORI for the fiscal quarter ended
June 30, 1997, as filed with the Commission on August 4, 1997.
18. The Annual Report on Form 10-K for Transcontinental Realty Investors,
Inc. ("TCI") for the year ended December 31, 1996, as filed with the Commission
on March 26, 1997.
19. The Quarterly Report on Form 10-Q for TCI for the fiscal quarter ended
March 31, 1997, as filed with the Commission on May 12, 1997.
20. The Quarterly Report on Form 10-Q for TCI for the fiscal quarter ended
June 30, 1997, as filed with the Commission on August 7, 1997.
21. The Current Report on Form 8-K for TCI dated September 16, 1997, as
filed with the Commission on October 14, 1997.
22. The Annual Report on Form 10-K for National Realty, L.P. ("NRLP") for
the year ended December 31, 1996, as filed with the Commission on March 25,
1997.
23. The Quarterly Report on Form 10-Q for NRLP for the fiscal quarter ended
March 31, 1997, as filed with the Commission on May 13, 1997.
24. The Quarterly Report on Form 10-Q for NRLP for the fiscal quarter ended
June 30, 1997, as filed with the Commission on August 11, 1997.
25. The description of the Common Stock contained in the Company's
Registration Statement under Section 12 of the Exchange Act and all amendments
and reports filed for the purpose of updating that description.
Each document filed by the Company, CMET, IORI, TCI or NRLP subsequent to
the date of this Prospectus pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act prior to termination of the offering of the Common Stock to which
this Prospectus relates shall be deemed to be incorporated by reference in this
Prospectus and shall be part hereof from the date of filing of such document.
Any statement
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<PAGE> 5
contained in a document that is deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein or in any other subsequently filed
document that is also deemed to be incorporated by reference herein modifies or
supersedes such statement, and any statement contained in this Prospectus shall
be deemed to be modified or superseded to the extent that a statement contained
in any subsequently filed document that also is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus. The Company will provide without charge
to each person, including any beneficial owner, to whom a copy of this
Prospectus is delivered, upon the written or oral request of any such person, a
copy of any document described above (other than exhibits). Requests for such
copies should be directed to American Realty Trust, Inc., 10670 North Central
Expressway, Suite 300, Dallas, Texas 75231, Attention: Investor Relations. The
Company's telephone number is (214) 692-4700.
THE COMPANY
The Company, a Georgia corporation, is the successor to a District of
Columbia business trust organized pursuant to a declaration of trust dated July
14, 1961. The business trust merged into the Company on June 24, 1988. The
Company invests in equity interests in real estate (including equity securities
of real estate-related entities), leases, joint venture development projects and
partnerships and finances real estate and real estate activities through
investments in mortgage loans. The Company has invested in private and open
market purchases in the equity securities of Continental Mortgage and Equity
Trust ("CMET"), Income Opportunity Realty Investors, Inc. ("IORI"),
Transcontinental Realty Investors, Inc. ("TCI") and National Realty, L.P.
("NRLP").
The Company's board of directors has broad authority under the Company's
governing documents to make all types of real estate investments, including
mortgage loans and equity real estate investments, as well as investments in the
securities of other entities, whether or not such entities are engaged in real
estate related activities.
Although the Company's board of directors is directly responsible for
managing the affairs of the Company and for setting the policies which guide it,
the day-to-day operations of the Company are performed by Basic Capital
Management, Inc. ("BCM"). BCM is a contractual advisor under the supervision of
the Company's board of directors. The duties of BCM include, among other things,
locating, investigating, evaluating and recommending real estate and mortgage
note investment and sales opportunities, as well as financing and refinancing
sources for the Company. BCM also serves as a consultant in connection with the
Company's business plan and investment policy decisions made by the Company's
board of directors.
BCM is a company owned by a trust for the benefit of the children of Gene
E. Phillips, the Chairman of the Board and a Director of the Company until
November 16, 1992. Gene Phillips served as a director of BCM until December 22,
1989 and as Chief Executive Officer of BCM until September 1, 1992. Gene
Phillips currently serves as a representative of the trust for the benefit of
his children that owns BCM and, in such capacity, Gene Phillips has substantial
contact with the management of BCM and input with respect to BCM's performance
of advisory services to the Company. Ryan T. Phillips, the son of Gene Phillips
and a Director of the Company until June 4, 1996, is also a director of BCM and
a trustee of the trust for the benefit of the children of Gene Phillips which
owns BCM. As of September 19, 1997, BCM owned 5,243,860 shares of the Company's
Common Stock, approximately 43.9% of the shares then outstanding. BCM has been
providing advisory services to the Company since February 6, 1989. BCM also
serves as advisor to CMET, IORI and TCI. Karl L. Blaha, Randall M. Paulson,
Bruce A. Endendyk and Thomas A. Holland, executive officers of the Company, are
also executive officers of CMET, IORI and TCI. Karl Blaha also serves as a
Director of the Company. Oscar W. Cashwell, a Director of the Company, served as
Executive Vice President of BCM until January 10, 1997. Randall M. Paulson,
Executive Vice President of the Company, serves as President and sole director
of Syntek Asset Management, Inc. ("SAMI"), the managing general partner of
Syntek Asset Management, L.P. ("SAMLP"), the general partner of NRLP and
National Operating, L.P. ("NOLP"), the operating partnership of NRLP. Gene
Phillips is also a general partner of SAMLP and served
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as a director and Chief Executive Officer of SAMI until May 15, 1996. SAMI is a
company owned by BCM. BCM performs certain administrative functions for NRLP and
NOLP on a cost reimbursement basis.
Since February 1, 1990, affiliates of BCM have provided property management
services to the Company. Currently, Carmel Realty Services, Ltd. ("Carmel,
Ltd.") provides such property management services. Carmel, Ltd. subcontracts
with other entities for the provision of the property-level management services
to the Company at various rates. The general partner of Carmel, Ltd. is BCM. The
limited partners of Carmel, Ltd. are (i) First Equity Properties, Inc. ("First
Equity"), which is 50% owned by BCM, (ii) Gene Phillips and (iii) a trust for
the benefit of the children of Gene Phillips. Carmel, Ltd. subcontracts the
property-level management of the Company's hotels, shopping centers, one of its
office buildings and the Denver Merchandise Mart to Carmel Realty, Inc. ("Carmel
Realty") which is owned by First Equity. Carmel Realty is entitled to receive
property and construction management fees and leasing commissions in accordance
with the terms of its property-level management agreement with Carmel, Ltd.
Affiliates of BCM are also entitled to receive real estate brokerage
commissions in accordance with the terms of the advisory agreement between the
Company and BCM.
The Company has no employees itself but a wholly-owned food service
subsidiary has approximately 790 employees. Employees of BCM render services to
the Company.
The Company's principal offices are located at 10670 North Central
Expressway, Suite 300, Dallas, Texas 75231. The Company's telephone number is
(214) 692-4700.
USE OF PROCEEDS
The Company has no basis for estimating either the number of shares of
Common Stock, if any, that will ultimately be purchased from the Company under
the Plan or the prices at which such shares will be sold. Proceeds from the
shares of Common Stock purchased from the Company will be used for general
corporate purposes.
DESCRIPTION OF THE DIVIDEND REINVESTMENT PLAN
The Company is offering the holders of its Common Stock the opportunity to
purchase additional shares of Common Stock through the Plan. The following is a
numbered question-and-answer format describing the provisions of the Plan. This
description constitutes the full terms of the Plan.
PURPOSE
1. What is the purpose of the Plan?
The purpose of the Plan is to provide holders of the Company's Common Stock
with a convenient method of investing cash dividends in additional shares of
Common Stock without payment of brokerage commissions or service charges.
Because the shares of Common Stock purchased under the Plan will be acquired
from the Company, the Plan will provide the Company with additional equity
capital that will be available for general corporate purposes.
ADVANTAGES
2. What are the advantages of investment in the Plan?
The Plan conveniently allows the participant to purchase additional shares
of Common Stock through automatic reinvestment of Common Stock dividends into
additional shares of Common Stock. The participant pays no commission or service
charge in connection with the purchases of Common Stock under the Plan. Full
investment of the participant's funds is possible because the Plan permits
fractions of shares, as well as full shares, to be credited to the participant's
account. Additionally, the Company provides a statement of account as soon as
practicable after each investment, simplifying the participant's record-keeping.
The Plan's
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safekeeping feature also protects the participant against the loss, theft or
destruction of stock certificates through the retention of shares of Common
Stock purchased through the Plan ("Plan Shares").
ADMINISTRATION
3. Who administers the Plan for participants?
American Stock Transfer & Trust Company (the "Agent"), or such other trust
company or bank as the Company may from time to time designate as agent for the
participants, administers the Plan and, in such capacity, purchases all shares
for the participants, keeps a continuing record of participants' accounts, sends
statements of account to participants and performs for participants other duties
relating to the Plan. Shares of Common Stock purchased under the Plan will be
registered in the name of the Agent or the nominee of the Agent for participants
in the Plan. As record holder of the shares held in participants' accounts under
the Plan, the Agent will receive dividends on all shares of Common Stock held in
the Plan on each respective dividend record date, will credit such dividends to
participants' accounts on the basis of full and fractional shares held in such
accounts, and will automatically reinvest such dividends in additional shares of
Common Stock.
All communications regarding the Plan should be sent to the Agent at the
following address:
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
The Agent may also be contacted by telephone toll free at (800) 678-7899.
PARTICIPATION
4. Who is eligible to participate in the Plan?
All record holders of Common Stock are eligible to participate in the Plan.
Participation is entirely voluntary and may be discontinued at any time. A
record holder may participate in the Plan with respect to all or any portion of
the shares of the Common Stock registered in his or her name. To be eligible to
participate in the Plan, a beneficial owner whose shares are held in a name
other than his or her own (e.g., in the name of a broker or bank nominee) must
either (i) become a stockholder of record by having such shares transferred into
his or her name, or (ii) make appropriate arrangements with his or her nominee
to participate on behalf of the beneficial owner. The Company reserves the right
to refuse to permit a broker, bank nominee or other record holder to participate
in the Plan if the terms of such participation would, in the Company's judgment,
result in excessive cost or burden on the Company. NEITHER THE AGENT NOR THE
COMPANY WILL BE RESPONSIBLE, HOWEVER, FOR THE MAINTENANCE OF THE INDIVIDUAL
ACCOUNTS OF ANY BROKER OR NOMINEE WHO ELECTS TO PARTICIPATE NOR WILL IT BE
RESPONSIBLE FOR ANY FEES CHARGED BY SUCH BROKER OR NOMINEE IN THE PERFORMANCE OF
ITS DUTIES ON BEHALF OF SUCH BENEFICIAL OWNERS. THE COMPANY MAY REFUSE
PARTICIPATION IN THE PLAN TO HOLDERS OF COMMON STOCK RESIDING IN STATES WHOSE
SECURITIES LAWS DO NOT EXEMPT OFFERS AND SALES PURSUANT TO THE PLAN FROM
REGISTRATION.
5. How does an eligible stockholder participate?
A stockholder whose shares are registered in such stockholder's own name
may become a participant in the Plan by execution and delivery to the Agent of
an Enrollment Authorization Card. An Enrollment Authorization Card will be
provided from time to time by mail to each stockholder of record and will also
be furnished at any time upon written or oral request to the Agent. If shares
are registered in more than one name (e.g., joint tenants, trustees, etc.), all
registered owners must sign the Enrollment Authorization Card exactly as such
shares are registered.
STOCKHOLDERS WHOSE SHARES ARE HELD IN A NAME OTHER THAN THEIR OWN SHOULD
CONSULT THEIR BROKER OR NOMINEE TO DETERMINE WHETHER THEY MAY PARTICIPATE AND,
IF SO, HOW AND WHETHER ANY FEES WILL BE CHARGED BY THE BROKER OR NOMINEE IN
CONNECTION WITH SUCH PARTICIPATION.
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6. When may a stockholder join the Plan?
An eligible stockholder may join the Plan at any time. Participation will
begin with the next dividend payable following receipt by the Agent of the
Enrollment Authorization Card unless there is insufficient time to process the
participant's enrollment prior to the payment of such dividend, in which case
participation will begin with the next following dividend payment.
7. What does the Enrollment Authorization Card provide?
The Enrollment Authorization Card directs the Agent to apply all of the
participant's cash dividends on
(i) the number of shares of Common Stock held by the participant on
the applicable record date and designated to be included in the Plan, and
(ii) all whole and fractional shares of Common Stock that have been
credited to a participant's Plan account through the reinvestment of
dividends,
toward the purchase of additional shares of Common Stock.
8. How may a participant change investment options under the Plan?
A participant's investment options under the Plan may be changed by
completion and delivery to the Agent of a new Enrollment Authorization Card.
Changes will be effective with the next dividend payable following receipt by
the Agent of the Enrollment Authorization Card unless there is insufficient time
to process the change prior to the payment of such dividend, in which case the
change will be effective with the next following dividend payment.
PURCHASES
9. What will be the price of shares of Common Stock purchased under the Plan?
The Agent will purchase shares directly from the Company effective as of
the close of business on the applicable dividend payment date. The purchase
price of shares purchased for the Plan directly from the Company will be the
average of the daily high and low sales prices of the Common Stock for the
period of five trading days ending on the dividend payment date as reported in
the New York Stock Exchange composite transaction listing, less a discount
(ranging from 0% to 10%) from such market price.
As of the date of this Prospectus, the discount for purchases directly from
the Company is 10%, but may be changed or eliminated by the Company without
prior notice to participants at any time. The discount on shares issued directly
by the Company shall not exceed 10% of the closing price for the Common Stock as
reported in the New York Stock Exchange composite transaction listing on the
relevant dividend payment date.
Pending investment, all dividends shall be held in non-interest bearing
accounts maintained by the Agent.
Since purchase prices for the Common Stock are established on the dates of
purchase, a participant loses any advantages otherwise available from being able
to select the timing of investments. Participants should recognize that neither
the Company nor the Agent can assure a profit or protect against a loss on
shares of Common Stock purchased under the Plan. Neither the Company nor the
Agent will have any liability to participants in connection with the timing of
purchases, the price at which shares are purchased or the failure to make
purchases at any time because of applicable legal restrictions.
10. How many shares of Common Stock will be purchased for participants?
The number of shares to be purchased depends on the amount of the
participant's dividend and the price of the Common Stock acquired for such
participant. Each participant's account will be credited with the number of
shares, including fractions computed to four decimal places, equal to the total
amount of the dividend invested divided by the purchase price of the Common
Stock acquired.
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EXPENSES
11. What are the expenses to participants in the Plan?
There are no brokerage commissions related to purchases of shares of Common
Stock by the Agent directly from the Company. The Company will pay the costs of
administration of the Plan, including charges by the Agent for bank services on
each dividend reinvestment by each participant in the Plan. The Agent may charge
a participant for additional services, not provided under the Plan, performed at
a participant's request. Certain expenses will be incurred by the participant if
the participant requests that shares of Common Stock be sold. See Question 15.
Brokers or nominees who participate on behalf of beneficial owners for whom they
are holding shares may charge such beneficial owners fees in connection with
such participation, for which neither the Agent nor the Company will be
responsible.
REPORTS TO PARTICIPANTS
12. What reports will be sent to participants in the Plan?
The Agent will mail to each participant in the Plan, as promptly as
practicable after each purchase of Common Stock for the participant's account, a
statement showing (i) dividends received on full or fractional shares held in
such participant's account or in the name of the Plan for the account of such
participant; (ii) full and fractional shares purchased and the purchase price of
such shares; and (iii) the beginning and new share balance of such participant's
account. These statements are a participant's continuing record of the cost of
such participant's purchases under the Plan and will contain the only records of
the purchase prices of shares acquired and should be retained for income tax
purposes. The Agent may charge additional fees to participants requesting copies
of past statements. In addition, participants will receive the same information
distributed to all stockholders, including IRS information for reporting
dividends received.
Statements will not be provided directly to beneficial owners participating
in the Plan through a broker or nominee. Beneficial owners should arrange to
receive such information directly from their broker or nominee.
CERTIFICATES FOR SHARES
13. Will certificates be issued for shares of Common Stock purchased under the
Plan?
Normally, certificates for shares of Common Stock purchased under the Plan
will not be issued to participants until the participant withdraws from the
Plan. The Agent will maintain an account for each participant in the Plan. Whole
and fractional shares purchased on behalf of the participants by the Agent
pursuant to the Plan will be credited to the participants' accounts as "unissued
certificate" shares. No share certificate will be issued to participants for
shares credited to their accounts unless the participant requests otherwise.
Such requests must be made in writing to the Agent. Certificates will be issued
to participants with respect to full shares only. Issuance of such certificates
will not terminate the participant's participation in the Plan.
Shares credited to the account of a participant under the Plan may not be
pledged as collateral. A participant who wishes to pledge such shares must
request that certificates for such shares be issued in the participant's name.
Certificates for fractions of shares will not be issued under any
circumstances. The Company and the Agent, at their discretion, may terminate any
account which contains only a fraction of a share by paying the account holder
the dollar value of such fractional share.
14. In whose name will certificates be registered when issued?
Certificates for whole shares issued upon the request of participants will
be registered in the names in which such participants' accounts are maintained
at the time of such request. For holders of record, this generally will be in
the name in which your share certificates are registered at the time you enroll
in the Plan. Upon request, shares will be registered in any other name upon the
presentation to the Agent of evidence of compliance with all applicable transfer
requirements (including the payment of any applicable transfer taxes).
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WITHDRAWAL
15. How does a participant withdraw from the Plan?
Participants may discontinue their participation with respect to some or
all of their shares of Common Stock enrolled in the Plan at any time upon
written notice to the Agent specifying the number of whole shares to be
withdrawn from the Plan. To be effective for any dividend payment, such notice
must be received by the Agent in sufficient time to process such notice of
withdrawal prior to payment of such dividend. In the event of insufficient time
to process such notice of withdrawal, the participant's account will be
terminated after dividends paid for such period have been credited to the
participant's account and invested pursuant to the Plan.
As soon as practicable after the effective date of a participant's
withdrawal, the Agent will send to the participant certificates, registered in
the name of such participant, for the number of whole shares of Common Stock in
the participant's account and a cash payment for any fraction of a share of
Common Stock. Such cash payment will be based on the then current market value
of the shares of Common Stock, less a $5.00 liquidation fee. All subsequent
dividends will be paid in cash by check sent to the stockholder unless the
stockholder elects to re-enroll in the Plan.
In connection with the withdrawal of shares from the Plan, a participant
may request that all or a part of the whole shares of Common Stock to be
withdrawn be sold. A request to sell shares must be in writing delivered to the
Agent. If a participant requests such sale, the Agent will use its best efforts
to make the sale for the participant's account in brokerage transactions regular
way on a national securities exchange within five business days after receipt of
the participant's request. The participant will receive the proceeds from such
sale, less any brokerage fees or commissions, service charges, transfer taxes
and other costs of sale and less a $5.00 liquidation fee. A participant
requesting such sale should be aware that the price of shares of Common Stock
may fall during the period between a request for sale, its receipt by the Agent,
and the ultimate sale in the open market. This risk should be evaluated, and
will be borne solely, by the participant. No redemption check will be mailed
prior to settlement of funds from the brokerage firm through which the sale is
executed, which settlement is normally three business days after the sale of the
stock.
In the event of the death or incompetence of a participant, the Agent shall
withdraw the participant from the Plan after receipt of satisfactory written
notice of such event and satisfactory proof of appointment of a legal
representative and of such legal representative's right to receive shares or
payments from the participant's account. The death or incompetence of a
participant shall not otherwise constitute termination of participation or
withdrawal from the Plan.
MODIFICATION OR TERMINATION
16. May the Company modify or terminate the Plan or terminate a participant's
participation?
The Company reserves the right to modify the Plan at any time. All
participants will be sent notice of any such modification, which shall be deemed
conclusively accepted by each participant except those participants from whom
the Agent receives written notice to discontinue participation prior to the
effective date thereof. The Company may terminate the Plan for any reason at any
time, upon written notice mailed to all participants at the addresses shown on
their accounts; provided that no such termination shall be made on or after a
record date for payment of a dividend until after the corresponding dividend
payment date and investment of such dividend payment in accordance with the
terms of the Plan, unless the Company pays to such participants in cash the
dividend that would have been payable on the shares in each such participant's
account on such record date. Upon any such termination, the Agent will send
promptly to each such participant a certificate, registered in the name of such
participant, for the number of whole shares of Common Stock held in the account
of such participant, to the registered address of such participant. Any
fractional shares will be liquidated at the then current market price on the
date the shares are sold, with the net proceeds thereof to be sent to such
participants by check.
The Company reserves the right (in its sole discretion) to terminate a
participant's participation in, or exclude any person from participation in, the
Plan.
9
<PAGE> 11
OTHER INFORMATION
17. What happens when a participant sells or transfers all of the shares of
Common Stock registered in the participant's name?
If a participant ceases to be a stockholder of record, the Agent will
continue to reinvest the dividends on the shares of Common Stock held for the
participant in the Plan until otherwise notified.
18. What happens if the Company issues a stock dividend or declares a stock
split or has a rights offering?
Shares of Common Stock distributed either as a result of a stock dividend
or a stock split on shares of Common Stock enrolled in the Plan and held by the
Agent for participants will be credited to the participants' accounts.
In the event that the Company makes available to its holders of Common
Stock rights to purchase additional shares of Common Stock or other securities,
the shares of Common Stock held for each participant under the Plan will be
added to other shares of Common Stock held by each such participant in
calculating the number of rights to be issued to each such participant.
19. How will a participant's shares be voted at meetings of holders of Common
Stock?
Each participant will receive a proxy for the total number of shares of
Common Stock (i) credited to such participant's Plan account and (ii) held of
record by such participant and not enrolled in the Plan. Participants may vote
all of their shares of Common Stock in person or by proxy.
20. What are the federal income tax consequences of participation in the Plan?
The federal income tax consequences that might occur as a result of
participation in the Plan are not well established. Therefore, participants are
advised to consult their tax advisors with respect to tax implications that may
be applicable to their specific situations. Based upon published Internal
Revenue Service rulings and private Internal Revenue Service rulings issued to
other companies, and other factors with respect to similar plans and
circumstances, the following tax implications should occur as a result of
participation in the Plan:
(1) Dividends reinvested in additional shares of Common Stock
purchased directly from the Company will be treated for federal income tax
purposes as having been received in the form of a cash distribution in an
amount described in (2) below. To the extent the Company has earnings and
profits for federal income tax purposes, the distribution will be treated
as a taxable dividend. The amount of the distribution should not be
increased as a result of the Company's payment of administrative fees or
other expenses of the Plan. However, should it be determined by the
Internal Revenue Service that the Company's payment of such administrative
expenses increases the amount of the distribution, the amount includable in
income would be deductible as an expense incurred for the production of
income by corporations and individuals who itemize deductions (subject to
the two percent of adjusted gross income limitation under the Tax Reform
Act of 1986). Participants who do not itemize may be liable for additional
taxes including interest on any amount due to the government.
(2) For shares purchased from the Company with reinvested dividends,
the taxable amount of the dividends and the tax basis of the shares
normally will be the fair market value of the shares on the dividend
payment date.
(3) The holding period of shares acquired directly from the Company
will begin the day after such shares are credited to the participant's
account, which in no event will be earlier than the dividend payment date.
(4) A participant will not realize any taxable income when he or she
receives certificates for whole shares credited to his or her account under
the Plan, either upon his or her request for certificates or upon
withdrawal from or termination of the Plan. However, a participant who
receives, upon withdrawal from or termination of the Plan, a cash
adjustment from a fractional share credited to his or her account may
realize a gain or loss (which, for most participants, should be capital
gain or loss) in respect of such cash
10
<PAGE> 12
adjustment. Gain or loss may also be realized by a participant when whole
shares are sold either by the Agent upon the participant's request or by
the participant after withdrawal from the Plan. The amount of such gain or
loss will be the difference between the amount the participant receives for
his or her shares or fractional share and his or her tax basis thereof.
Under Section 3406(a)(1) of the Internal Revenue Code, the Company is
required to withhold for United States income tax purposes 31% of all dividend
payments to a stockholder of the Company if (i) such stockholder has failed to
furnish to the Company such participant's taxpayer identification number
("TIN"), which for an individual is such individual's social security number,
(ii) the Internal Revenue Service has notified the Company that the TIN
furnished by the stockholder is incorrect, (iii) the Internal Revenue Service
notifies the Company that back-up withholding should be commenced because the
stockholder has failed to properly report interest or dividends or (iv) the
stockholder has failed to certify, under penalties of perjury, that such
stockholder is not subject to back-up withholding.
If a participant is a foreign stockholder whose dividends are subject to
United States income tax withholding, the amount of dividends to be reinvested
will be determined after deducting the withholding tax.
Statements of account will be sent to each participant in the Plan as
promptly as practicable after each purchase of shares of Common Stock for such
participant's account. Copies of required Internal Revenue Service Form 1099, or
Form 1042s for foreign stockholders, will be sent to participants showing
reportable dividends and/or tax withheld. These statements of account and copies
of Internal Revenue Service forms should be retained for tax purposes. The
statements of account are the only record of purchase prices for shares acquired
through the Plan and will be required to establish the tax basis of such shares
when sold.
The tax consequences under state and local tax laws will vary from
jurisdiction to jurisdiction. Participants should consult their own tax advisors
to determine the particular tax consequences which may result from participation
in the Plan and subsequent disposal of shares purchased pursuant to the Plan.
The Company believes the foregoing is an accurate summary of the tax
consequences of participation in the Plan as of the date of this Prospectus, but
participants should consult with their own tax advisors for advice applicable to
their particular situation.
21. What are the responsibilities of the Company and the Agent under the Plan?
Neither the Company nor the Agent will be liable in administering the Plan
for any act done in good faith, or for any good-faith omission to act,
including, without limitation, any claims of liability (i) arising out of
failure to terminate a participant's account upon such participant's death or
adjudication of incompetence prior to receipt of satisfactory written notice of
such death or incompetence as described in Question 15, (ii) with respect to the
prices at which shares are purchased or sold for a participant's account or the
times when such purchases or sales are made, or (iii) with respect to any
fluctuation in the market value prior to or after purchase or sale of shares.
Government regulation or other circumstances may require the temporary
curtailment or suspension of purchases under the Plan. Neither the Company nor
the Agent will have any liability in connection with any inability to purchase
or sell shares of Common Stock under the Plan.
22. Does participation in the Plan involve any risk?
The risk to participants is the same as with any other investment in shares
of Common Stock. A participant may lose an advantage otherwise available from
being able to select more specifically the timing of investment in or sale of
the shares. Participants must recognize that neither the Company nor the Agent
can assure a profit or protect against a loss on the shares purchased under the
Plan.
ALTHOUGH THE PLAN CONTEMPLATES THE CONTINUATION OF QUARTERLY DIVIDEND
PAYMENTS, THE PAYMENT OF FUTURE DIVIDENDS WILL DEPEND UPON FUTURE EARNINGS, THE
FINANCIAL CONDITION OF THE COMPANY AND OTHER FACTORS.
11
<PAGE> 13
23. Where are notices and other communications to participants under the Plan
sent?
Notices and other communications sent to participants under the Plan will
be addressed to the participant's last known address as reflected on the Agent's
records. Therefore, the participant should notify the Agent promptly in writing
of any change in address.
24. May the Agent resign and, if so, how is it to be replaced?
The Agent, upon thirty (30) days prior written notice to the Company, may
resign as Agent hereunder. Likewise, the Company, upon thirty (30) days prior
written notice to the Agent, may remove the Agent from its duties under the
Plan. The Company may appoint a successor agent, who shall commence to serve as
Agent hereunder upon its agreement, in writing, for the benefit of participants,
to be bound by and comply with the terms hereof.
LEGAL MATTERS
Certain legal matters with respect to the Common Stock offered by the
Company will be passed upon for the Company by Holt Ney Zatcoff & Wasserman,
LLP, Atlanta, Georgia.
EXPERTS
The financial statements and schedules incorporated by reference in this
Prospectus have been audited by BDO Seidman, LLP, independent certified public
accountants, to the extent and for the period set forth in their reports
incorporated herein by reference, and are incorporated herein in reliance upon
the authority of said firm as experts in auditing and accounting.
12
<PAGE> 14
======================================================
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION AND
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE REGISTERED SECURITIES TO WHICH IT RELATES. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS
UNLAWFUL.
---------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................ 2
Incorporation of Certain Information
By Reference....................... 2
The Company.......................... 4
Use of Proceeds...................... 5
Description of the Dividend
Reinvestment Plan.................. 5
Legal Matters........................ 12
Experts.............................. 12
</TABLE>
======================================================
======================================================
150,000 SHARES
COMMON STOCK
AMERICAN REALTY
TRUST, INC.
---------------------
PROSPECTUS
---------------------
DIVIDEND REINVESTMENT PLAN
NOVEMBER 6, 1997
======================================================
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Set forth below is an estimate of the amount of fees and expenses to be
incurred in connection with the issuance and distribution of the shares of
Common Stock offered hereby, other than underwriting discounts and commissions.
<TABLE>
<S> <C>
SEC Registration Fee........................................ $ 659.09
Blue Sky Fees and Expenses.................................. 600.00
Legal Fees and Expenses..................................... 8,600.00
Accounting Fees and Expenses................................ 2,500.00
Printing and Engraving Expenses............................. 6,000.00
----------
Total............................................. $18,359.09
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article Thirteen of the Articles of Incorporation of the Company provides
that, to the fullest extent permitted by Georgia law, as the same exists or may
hereafter be amended, no director of the Company shall be personally liable to
the Company or the shareholders of the Company for monetary damages for breach
of the duty of care as a director, provided that Article Thirteen does not limit
or eliminate liability arising or based upon (i) a breach of duty involving an
appropriation of a business opportunity of the Company; (ii) an act or omission
not in good faith or involving intentional misconduct or a knowing violation of
law; or (iii) a transaction from which the director derived an improper personal
benefit. In addition, a director's liability will not be limited as to any
payment of a dividend or approval of a stock repurchase that is illegal under
Section 14-2-640 of the Georgia Business Corporation Code.
Article Thirteen applies only to claims against a director arising out of
his or her role as a director and not, if he or she is also an officer, his or
her role as an officer or in any other capacity. In addition, Article Thirteen
does not reduce the exposure of directors to liability under Federal securities
laws.
The Bylaws of the Company require the Company to indemnify any person who,
by reason of the fact that he is or was a director of the Company, is made or is
threatened to be made a party to an action, including an action brought by the
Company or its shareholders. The Bylaws provide that the Company will indemnify
such person against reasonably incurred expenses (including, but not limited to,
attorneys' fees and disbursements, court costs, and expert witness fees), and
against any judgments, fines and amounts paid in settlement, provided that the
Company shall not indemnify such person under circumstances in which the Georgia
Business Corporation Code, as in effect from time to time, would not allow
indemnification.
The Bylaws of the Company give the board of directors the power to cause
the Company to provide to officers, employees and agents of the Company all or
any part of the right to indemnification afforded to directors of the Company as
set forth in the Bylaws, subject to the conditions, limitations and obligations
therein, upon a resolution to that effect identifying such officer, employee or
agent and specifying the particular rights provided.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, the Company has been informed that in the
opinion of the Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
II-1
<PAGE> 16
ITEM 16. EXHIBITS
<TABLE>
<C> <S>
*5.1 -- Opinion of Holt Ney Zatcoff & Wasserman, LLP, as to the
legality of the shares being offered
*23.1 -- Consent of BDO Seidman, LLP (American Realty Trust, Inc.)
*23.2 -- Consent of BDO Seidman, LLP (Continental Mortgage and
Equity Trust)
*23.3 -- Consent of BDO Seidman, LLP (Income Opportunity Realty
Investors, Inc.)
*23.4 -- Consent of BDO Seidman, LLP (Transcontinental Realty
Investors, Inc.)
*23.5 -- Consent of BDO Seidman, LLP (National Realty, L.P.)
*23.6 -- Consent of Holt Ney Zatcoff & Wasserman, LLP
(incorporated in Exhibit 5.1)
*24.1 -- Power of Attorney (Set forth on page II-4 of this
Registration Statement)
</TABLE>
- - ---------------
* Filed herewith.
ITEM 17. UNDERTAKINGS
(a) The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this Registration Statement
or any material change to such information in this Registration
Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do
not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Company hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Company's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to Item 15, above, or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnifica-
II-2
<PAGE> 17
tion is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Company of expenses incurred or paid
by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Company will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Dallas, State of Texas, on the 6th day of November,
1997.
AMERICAN REALTY TRUST, INC.
By: /s/ KARL L. BLAHA
----------------------------------
Karl L. Blaha
President (Principal Executive
Officer)
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Robert
A. Waldman his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him in his name, place and stead, in any
and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully as to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his substitute or
substitutes, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ KARL L. BLAHA President (Principal November 6, 1997
- - ----------------------------------------------------- Executive Officer) and
Karl L. Blaha Director
/s/ ROY E. BODE Director November 6, 1997
- - -----------------------------------------------------
Roy E. Bode
/s/ OSCAR W. CASHWELL Director November 6, 1997
- - -----------------------------------------------------
Oscar W. Cashwell
/s/ AL GONZALEZ Director November 6, 1997
- - -----------------------------------------------------
Al Gonzalez
/s/ DALE A. CRENWELGE Director November 6, 1997
- - -----------------------------------------------------
Dale A. Crenwelge
</TABLE>
II-4
<PAGE> 19
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ CLIFF HARRIS Director November 6, 1997
- - -----------------------------------------------------
Cliff Harris
/s/ THOMAS A. HOLLAND Executive Vice President and November 6, 1997
- - ----------------------------------------------------- Chief Financial Officer
Thomas A. Holland (Principal Accounting
Officer)
</TABLE>
II-5
<PAGE> 20
INDEX TO EXHIBITS
<TABLE>
<C> <S>
*5.1 -- Opinion of Holt Ney Zatcoff & Wasserman, LLP, as to the
legality of the shares being offered
*23.1 -- Consent of BDO Seidman, LLP (American Realty Trust, Inc.)
*23.2 -- Consent of BDO Seidman, LLP (Continental Mortgage and
Equity Trust)
*23.3 -- Consent of BDO Seidman, LLP (Income Opportunity Realty
Investors, Inc.)
*23.4 -- Consent of BDO Seidman, LLP (Transcontinental Realty
Investors, Inc.)
*23.5 -- Consent of BDO Seidman, LLP (National Realty, L.P.)
*23.6 -- Consent of Holt Ney Zatcoff & Wasserman, LLP
(incorporated in Exhibit 5.1)
*24.1 -- Power of Attorney (Set forth on page II-4 of this
Registration Statement)
</TABLE>
- - ---------------
* Filed herewith.
II-6
<PAGE> 1
EXHIBIT 5.1
[Letterhead of Holt Ney Zatcoff & Wasserman, LLP]
November 6, 1997
American Realty Trust, Inc.
10670 North Central Expressway, Suite 300
Dallas, Texas 75231
RE: POTENTIAL ISSUANCE OF SHARES OF COMMON STOCK, PAR VALUE $.01 PER
SHARE ("COMMON STOCK"), OF AMERICAN REALTY TRUST, INC., A
GEORGIA CORPORATION ("ART"), PURSUANT TO ART'S DIVIDEND
REINVESTMENT PLAN (THE "PLAN")
Ladies and Gentlemen:
We have acted as special Georgia counsel to ART with respect to the
application and interpretation of the Georgia Business Corporation Code (the
"GBCC") to the potential issuance of shares of Common Stock pursuant to the
Plan. This opinion letter is rendered at the request of ART to facilitate
ART's contemporaneous registration (the "Registration") of 150,000 shares of
Common Stock with the Securities and Exchange Commission for issuance pursuant
to the Plan.
In the capacity described above, we have considered such matters of law
and of fact, including the examination of originals or copies, certified or
otherwise identified to our satisfaction, of such records and documents of ART,
certificates of officers and representatives of ART, certificates of public
officials, and other documents as we have deemed appropriate as a basis for the
opinion hereinafter set forth.
Based upon the foregoing, as of this date, and subject to the
assumptions, limitations and qualifications set forth in the lettered
paragraphs which follow this paragraph, we are of the opinion that upon a
Qualified Issuance (as defined in the following sentence) of shares of Common
Stock the shares of Common Stock issued in connection therewith will be duly
authorized, validly issued, fully paid and nonassessable, with no personal
liability attaching to the ownership thereof. For purposes of this opinion, an
issuance of shares of Common Stock is a "Qualified Issuance" if, and only if:
(a) it is effected in accordance with the Plan; and (b) the number of shares of
Common Stock being issued in connection therewith does not cause the total
number of issued shares of Common Stock to exceed the total number of shares of
Common Stock which ART is authorized to issue.
<PAGE> 2
HOLT NEY ZATCOFF & WASSERMAN, LLP
American Realty Trust, Inc.
November 6, 1997
Page 2
The opinion expressed herein is subject to the following assumptions,
limitations and qualifications.
A. As to various questions of fact material to this
opinion, we have relied solely upon the statements and
certifications of Mr. Robert A. Waldman, Secretary of ART.
B. We have made no investigation regarding the accuracy or
truthfulness of any representations, warranties, statements of
fact or assumptions of fact contained in any documents, records,
instruments, letters or other writings examined by us, and we
express no opinion herein regarding the same.
C. We expressly note that our opinion expressed herein does
not mean that: (a) any past or future authorization of shares of
Common Stock complied or will comply with agreements by which
ART is bound; (b) any particular issuance of shares of Common
Stock will be a Qualified Issuance or will comply with
agreements by which ART may now or then be bound; (c) any past
or future authorization of shares of Common Stock or any
particular issuance of shares of Common Stock complied or will
comply with (i) the fiduciary duties of the directors of ART or
(ii) any law other than the GBCC (including but not limited to
federal or state securities laws); (d) ART has reserved or has
available or will reserve or have available sufficient numbers
of authorized shares of Common Stock to effect any particular
issuance pursuant to the Plan; (e) the consideration that ART
will receive in connection with any particular issuance of
shares of Common Stock pursuant to the Plan will be (i)
equivalent (or approximately equivalent) in value to the value
of the shares being issued or (ii) adequate as a matter of
fairness to ART and its shareholders; (f) a holder of shares of
Common Stock issued pursuant to the Plan will be immune from
other types of liabilities, such as liability for distributions
in violation of Section 640 of the GBCC, or under the "piercing
the corporate veil" theory; or (g) any past or future
authorization of shares of Common Stock, or any particular
issuance of shares of Common Stock, has not unfairly diluted or
will not unfairly dilute the investment value of existing
shareholders of ART. Our opinion assumes that each of items (a)
through (g) is or will be true.
<PAGE> 3
HOLT NEY ZATCOFF & WASSERMAN, LLP
American Realty Trust, Inc.
November 6, 1997
Page 3
D. This opinion letter is limited by, and is in accordance with,
the January 1, 1992 edition of the Interpretive Standards (the
"Interpretive Standards") Applicable to Legal Opinions to Third
Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the Corporate and Banking Law Section of the State
Bar of Georgia, which Interpretive Standards are incorporated in
this opinion letter by this reference; in particular, without
limiting the generality of the foregoing, our opinion is subject
to the exceptions stated in paragraph 23(i) of the Interpretive
Standards, which makes exception for the effect of bankruptcy
and similar laws as described therein.
E. The opinion set forth herein is based solely upon the GBCC.
Nothing herein should be construed to express any opinion as to
the applicability or effect of any other law, be it a law of any
jurisdiction other than Georgia or a law of Georgia other than
the GBCC.
F. The opinion expressed herein is addressed exclusively to the
particular matters described herein, to the state of our
knowledge with respect thereto, to the state of all relevant
documents, including but not limited to ART's Articles of
Incorporation (as amended to the date hereof), and to the state
of the law applicable thereto, all as of the date hereof. We
assume no responsibility for commenting on any other matters, or
for updating this letter as of any subsequent date.
G. This opinion letter is being provided solely for the
benefit of ART and Andrews & Kurth, L.L.P. ("A&K"), and no
other person, natural or legal, shall be entitled to rely hereon
without the express written consent of this firm. This opinion
letter may not be referred to or quoted from, in whole or in
part, in any financial statement or other document, nor may this
opinion letter be filed with or furnished to any person, natural
or legal, other than ART and A&K, including but not limited to
any governmental agency, in each case unless the prior written
consent of this firm has been obtained. Our consent is hereby
given to (a) the use and filing of this opinion letter as an
exhibit to ART's Registration Statement on Form S-3 in respect
of the Registration and (b) the reference to our firm under the
caption "Legal Matters" in the Prospectus filed as part of such
Registration Statement. In giving such consent we do not imply
or admit that we are an expert (within
<PAGE> 4
HOLT NEY ZATCOFF & WASSERMAN, LLP
American Realty Trust, Inc.
November 6, 1997
Page 4
the meaning of the Securities Act of 1933, as amended, or the
rules and regulations promulgated thereunder) with respect to
said exhibit or any other part of such Registration Statement.
Yours very truly,
HOLT NEY ZATCOFF & WASSERMAN, LLP
By Michael G. Wasserman, P.C.
By: /s/ MICHAEL G. WASSERMAN
----------------------------
Michael G. Wasserman
<PAGE> 1
EXHIBIT 23.1
Consent of Independent Certified Public Accountants
American Realty Trust, Inc.
Dallas, Texas
We hereby consent to the use in the Prospectus constituting a part of this
Registration Statement of our report dated March 26, 1997, relating to the
consolidated financial statements of American Realty Trust, Inc. for the year
ended December 31, 1996.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
Dallas, Texas
November 4, 1997
<PAGE> 1
Exhibit 23.2
Consent of Independent Certified Public Accountants
American Realty Trust, Inc.
Dallas, Texas
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated March
21, 1997, relating to the consolidated financial statements and schedules of
Continental Mortgage and Equity Trust appearing in the Trust's Annual Report on
Form 10-K for the year ended December 31, 1996.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
Dallas, Texas
November 4, 1997
<PAGE> 1
EXHIBIT 23.3
Consent of Independent Certified Public Accountants
American Realty Trust, Inc.
Dallas, Texas
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated March 7,
1997, relating to the consolidated financial statements and schedules of Income
Opportunity Realty Investors, Inc. and the financial statements and schedules
of Tri-City Limited Partnership appearing in the Company's Annual Report on
Form 10-K for the year ended December 31, 1996.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
Dallas, Texas
November 4, 1997
<PAGE> 1
EXHIBIT 23.4
Consent of Independent Certified Public Accountants
American Realty Trust, Inc.
Dallas, Texas
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated March
20, 1997, relating to the consolidated financial statements and schedules of
Transcontinental Realty Investors, Inc. appearing in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
Dallas, Texas
November 4, 1997
<PAGE> 1
EXHIBIT 23.5
Consent of Independent Certified Public Accountants
American Realty Trust, Inc.
Dallas, Texas
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated March
14, 1997, relating to the consolidated financial statements and schedules of
National Realty, L.P. appearing in the Partnership's Annual Report on Form 10-K
for the year ended December 31, 1996.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
Dallas, Texas
November 4, 1997
