<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: (Date of Earliest Event Reported): November 19, 1999
(October 15, 1999)
--------------------
CRIIMI MAE INC.
(Exact name of registrant as specified in its charter)
Maryland 1-10360 52-1622022
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
---------------------
11200 Rockville Pike
Rockville, Maryland 20852
(Address of principal executive offices, including zip code, of Registrant)
(301) 816-2300
(Registrant's telephone number, including area code)
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Item 5. Other Events
- ---------------------
Attached as exhibits to this Current Report on Form 8-K are (1) a press
release issued by the Company on October 15, 1999, (2) a press release issued by
the Company on November 2, 1999 and (3) a press release issued by the Company on
November 15, 1999. Each of the above referenced documents is hereby incorporated
by reference herein.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
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The following exhibits are filed as a part of this Current Report on Form
8-K:
(c) Exhibit
99.1 Press Release issued by CRIIMI MAE Inc. on October 15, 1999.
99.2 Press Release issued by CRIIMI MAE Inc. on November 2, 1999.
99.3 Press Release issued by CRIIMI MAE Inc. on November 15, 1999.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CRIIMI MAE Inc.
Dated: November 19, 1999 /s/ William B. Dockser
- ------------------------- ----------------------
William B. Dockser
Chairman of the Board
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EXHIBIT INDEX
Exhibit
No. Description
- --------------------------------------------------------------------------------
*99.1 Press Release issued by CRIIMI MAE Inc. on October 15, 1999.
*99.2 Press Release issued by CRIIMI MAE Inc. on November 2, 1999.
*99.3 Press Release issued by CRIIMI MAE Inc. on November 15, 1999.
*Filed herewith.
<PAGE>5
EXHIBIT 99.1
Susan B. Railey
For shareholders and securities brokers
(301) 468-3120
Andrew P. Blocher
For institutional investors
(301) 231-0371
James T. Pastore FOR IMMEDIATE RELEASE
For news media
(202) 546-6451
CRIIMI MAE HEARING AND DISCLOSURE STATEMENT DEADLINE RESCHEDULED TO
NOVEMBER 1, 1999
ROCKVILLE, MARYLAND, October 15, 1999 - (NYSE:CMM) - Judge Duncan W. Keir
of the United States Bankruptcy Court in Greenbelt, Md. has rescheduled to
November 1, 1999, a hearing on a motion by CRIIMI MAE Inc. to approve bidding
protection provisions of the recently announced Stock Purchase Agreement (the
"Apollo Purchase Agreement") with an affiliate of Apollo Real Estate Advisors
IV, L.P. ("Apollo"). The hearing had previously been scheduled to take place
today. Judge Keir also extended to November 1, 1999, the due date for CRIIMI MAE
Inc. and two affiliates to file their proposed disclosure statement for their
Joint Plan of Reorganization.
On September 9, 1999, CRIIMI MAE announced that Apollo agreed, subject to a
number of conditions, to participate in financing an approximately $910 million
plan of reorganization whereby CRIIMI MAE would emerge from Chapter 11.
On October 5, 1998, the Company and two affiliates filed for protection
under Chapter 11 of the U.S. Bankruptcy Code. Before filing for reorganization,
the Company had been actively involved in acquiring, originating, securitizing
and servicing multi-family and commercial mortgages and mortgage related assets
throughout the United States. Since filing for Chapter 11 protection, CRIIMI MAE
has suspended its loan origination, loan securitization and CMBS acquisition
businesses. The Company continues to hold a substantial portfolio of
subordinated CMBS and, through its servicing affiliates, acts as a servicer for
its own as well as third party securitizations.
Note: Except for historical information, forward-looking statements
contained in this release involve a variety of risks and uncertainties. These
risks and uncertainties include the continued instability of the capital
markets, the ability of the Company to obtain the reorganization financing
called for by the Joint Plan of Reorganization filed by the Company and two
affiliates (the "Plan"), the trends in the CMBS market, competitive pressures,
the effect of future losses on CRIIMI MAE's need for liquidity, the ability to
obtain bankruptcy court approval of the Apollo Purchase Agreement including the
bidding protection provisions therein, the successful completion of due
diligence by Apollo, the satisfaction of all conditions to closing the Apollo
Purchase Agreement and reorganization financing, confirmation and effectiveness
of the Plan, the possible confirmation of an alternative plan, the ability to
obtain bankruptcy court approval of the disclosure statement, the effects of the
bankruptcy proceeding on CRIIMI MAE's ongoing business, the action of CRIIMI
MAE's creditors and equity securityholders, and the outcome of litigation to
which the Company is a party, as well as the risks and uncertainties that are
set forth from time to time in CRIIMI MAE's SEC reports, including the report on
Form 10-K for the year ended December 31, 1998 and the Form 10-Q for the quarter
ended June 30, 1999.
More information on CRIIMI MAE is available on its web site -
www.criimimaeinc.com - or for investors, call Susan Railey, 301-468-3120 or for
news media, call Jim Pastore, 202-546-6451.
<PAGE>6
EXHIBIT 99.2
Susan B. Railey
For shareholders and securities brokers
(301) 468-3120
Andrew P. Blocher
For institutional investors
(301) 231-0371
James T. Pastore FOR IMMEDIATE RELEASE
For news media
(202) 546-6451
CRIIMI MAE HEARING ON BID PROTECTION AND DEADLINE FOR DISCLOSURE STATEMENT
FILING POSTPONED UNTIL AFTER NOVEMBER 15, 1999
ROCKVILLE, MD, November 2, 1999 - (NYSE:CMM) - On November 1, 1999, Judge
Duncan W. Keir of the United States Bankruptcy Court in Greenbelt, MD approved a
motion (filed by CRIIMI MAE Inc. with the support of the Official Committee of
Unsecured Creditors and the Official Committee of Equity Securities Holders (the
"Committees")) to postpone until after November 15, 1999 the hearing on the
pending motion to approve the bidding protection provisions in the Stock
Purchase Agreement ("Agreement") entered into by CRIIMI MAE with an affiliate of
Apollo Real Estate Advisors IV, L.P. ("Apollo") on September 9, 1999. Likewise,
the date for the Company and two affiliates to file the proposed disclosure
statement with respect to its Joint Plan of Reorganization was extended to the
same date. The Court approved the immediate payment of $400,000 to Apollo for
reimbursement of expenses incurred with respect to the Agreement, continuing
negotiations, due diligence and related matters. The Court was advised of active
discussions among the Company, Apollo and the Committees to fashion an amended
plan of reorganization that can be supported by such parties.
On October 5, 1998, the Company and two affiliates filed for protection
under Chapter 11 of the U.S. Bankruptcy Code. Before filing for reorganization,
the Company had been actively involved in acquiring, originating, securitizing
and servicing multi-family and commercial mortgages and mortgage related assets
throughout the United States. Since filing for Chapter 11 protection, CRIIMI MAE
has suspended its loan origination, loan securitization and CMBS acquisition
businesses. The Company continues to hold a substantial portfolio of
subordinated CMBS and, through its servicing affiliate, acts as a servicer for
its own as well as third party securitizations.
More information on CRIIMI MAE is available on its web site -
www.criimimaeinc.com - or for investors, call Susan Railey, 301-468-3120 or for
news media, call Jim Pastore, 202-546-6451.
Note: Except for historical information, forward-looking statements
contained in this release involve a variety of risks and uncertainties. These
risks and uncertainties include the continued instability of the capital
markets, the ability of the Company to obtain the reorganization financing
called for by the Joint Plan of Reorganization filed by the Company and two
affiliates (the "Plan"), the trends in the CMBS market, competitive pressures,
the effect of future losses on CRIIMI MAE's need for liquidity, the ability to
obtain bankruptcy court approval of the Apollo Stock Purchase Agreement
including the bidding protection provisions therein, the successful completion
of due diligence by Apollo, the satisfaction of all conditions to closing the
Apollo Stock Purchase Agreement and reorganization financing, confirmation and
effectiveness of the Plan, the ability to fashion an Amended Plan that can be
confirmed, the possible confirmation of an alternative plan, the ability to
obtain bankruptcy court approval of a disclosure statement, the effects of the
bankruptcy proceeding on CRIIMI MAE's ongoing business, the action of CRIIMI
MAE's creditors and equity securityholders, and the outcome of litigation to
which the Company is a party, as well as the risks and uncertainties that are
set forth from time to time in CRIIMI MAE's SEC reports, including the report on
Form 10-K for the year ended December 31, 1998 and the Form 10-Q for the quarter
ended June 30, 1999.
###
<PAGE>7
EXHIBIT 99.3
Susan B. Railey
For shareholders and securities brokers
(301) 468-3120
Andrew P. Blocher
For institutional investors
(301) 231-0371
James T. Pastore FOR IMMEDIATE RELEASE
For news media
(202) 546-6451
CRIIMI MAE REPORTS THIRD QUARTER 1999 RESULTS
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Rockville, MD, November 15, 1999 - (NYSE: CMM) - CRIIMI MAE Inc., the
commercial mortgage company that filed a voluntary petition to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on October 5, 1998, today reported
results for the three and nine months ended September 30, 1999.
Under generally accepted accounting principles (GAAP), net income available
to common shareholders for the three months ended September 30, 1999 was $8.1
million. This compares to a net loss for last year's third quarter of
approximately $8.7 million. On a per share basis, the third quarter's net income
was 14 cents per diluted share and 15 cents per basic share. This compares to
last year's net loss for the third quarter of 18 cents per diluted share and 18
cents per basic share.
On a tax basis, CRIIMI MAE had a loss for the third quarter of
approximately $17.8 million, or 33 cents per share. For last year's third
quarter, tax basis income available to common shareholders was approximately
$19.9 million, or 41 cents per share. For the first nine months of 1999, tax
basis income was approximately $13.7 million, or 26 cents per share, compared to
approximately $57.3 million, or $1.22 per share, for the first nine months of
1998.
The sale of unsecuritized mortgage loans in one of the Company's warehouse
facilities in the third quarter of 1999 resulted in cumulative losses of
approximately $36.3 million under both GAAP and tax accounting. Under GAAP,
$35.2 million of these losses were recognized in prior quarters, and $1.1
million in losses were recognized in the third quarter of 1999. Under tax basis
accounting, the entire loss of $36.3 million was recognized in the third quarter
of 1999, when the actual loan sales took place.
<PAGE>8
CRIIMI MAE's shareholders' equity decreased to approximately $259 million
($3.86 per diluted share) at quarter end, from approximately $281 million ($4.24
per diluted share) at June 30, 1999. The decrease in shareholders' equity during
the quarter primarily resulted from an aggregate $30.5 million decrease in the
fair value of the Company's portfolio of commercial mortgage-backed securities
(CMBS) and insured mortgage securities.
The Company's net interest margin decreased by approximately $1.2 million
under GAAP and approximately $370,000 on a tax basis for the third quarter of
1999 compared to the third quarter of 1998. The decreases in net interest margin
were primarily due to an increase in interest expense related to certain
financing facilities that were outstanding for only a portion of last year's
third quarter, versus the entire third quarter of 1999.
Other items that contributed to the changes in earnings during these
periods are identified in the tables that follow.
The date currently set by the Bankruptcy Court for CRIIMI MAE and its two
affiliates to file a proposed disclosure statement with respect to their Joint
Plan of Reorganization is December 6, 1999. Judge Duncan W. Keir has also
scheduled a hearing for that date on a pending motion to approve the bidding
protection provisions in the Stock Purchase Agreement ("Agreement") entered into
on September 9, 1999 by CRIIMI MAE and an affiliate of Apollo Real Estate
Advisors IV, L.P. ("Apollo"). CRIIMI MAE, Apollo and the Official Committee of
Unsecured Creditors of CRIIMI MAE and the Official Committee of Equity
Securities Holders (collectively, the "Committees") have been actively engaged
in discussions to fashion an amended plan of reorganization that can be
supported by these parties.
Before filing for reorganization, CRIIMI MAE had been actively involved in
acquiring, originating, securitizing and servicing multifamily and commercial
mortgages and mortgage related assets throughout the United States. Since filing
for Chapter 11 protection, CRIIMI MAE has suspended its subordinated CMBS
acquisition, origination and securitization programs. The Company, however,
continues to hold a substantial portfolio of subordinated CMBS and, through its
servicing affiliate, acts as a servicer for its own as well as third party
securitizations.
More information on CRIIMI MAE is available on its web site -
www.criimimaeinc.com or for investors, call Susan Railey, 301-468-3120 or for
news media, call Jim Pastore, 202-546-6451.
Note: Except for historical information, forward-looking statements
contained in this release involve a variety of risks and uncertainties. These
risks and uncertainties include the continued instability of the capital
markets, the ability of the Company to obtain the reorganization financing,
including but not limited to the sale of selected CMBS to a party or parties for
the necessary proceeds, called for by the Joint Plan of Reorganization filed by
the Company and two affiliates, as such plan may be subsequently amended (the
"Plan"), the trends in the CMBS market, competitive pressures, the effect of
future losses on CRIIMI MAE's need for liquidity, the ability to obtain
bankruptcy court approval of the Agreement including the bidding protection
provisions therein, the successful completion of due diligence by Apollo, the
satisfaction of all conditions to closing the Agreement and reorganization
financing, confirmation and effectiveness of the Plan, the outcome of discussion
with the Committees and the ability to fashion an amended plan supported by the
Committees that can be confirmed, the possible confirmation of an alternative
plan of reorganization, the ability to obtain bankruptcy court approval of a
disclosure statement, the effects of the bankruptcy proceeding on CRIIMI MAE's
ongoing business, the actions of CRIIMI MAE's creditors and equity
securityholders, and the outcome of litigation to which the Company is a party,
as well as the risks and uncertainties that are set forth from time to time in
CRIIMI MAE's SEC reports, including its report on Form 10-K for the year ended
December 31, 1998 and its Form 10-Q for the quarter ended September 30, 1999.
-tables to follow-
<PAGE>9
CRIIMI MAE Inc.
<TABLE>
<CAPTION>
For the three For the nine
months ended months ended
September 30, September 30,
1999 1998 1999 1998
-------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
TAX BASIS (LOSS) INCOME:*
Interest Income:
Subordinated CMBS $ 52,333,298 $ 52,395,877 $ 157,805,773 $ 130,151,012
Insured Mortgage Securities 8,034,760 10,662,386 25,424,098 33,528,290
Originated loans
8,615,000 8,859,416 26,103,642 11,609,111
-------------- --------------- ------------- --------------
Total interest income 68,983,058 71,917,679 209,333,513 175,288,413
-------------- --------------- ------------- --------------
Interest and related expenses:
Fixed-rate collateralized bond obligations-CMBS 15,086,365 10,952,081 42,026,829 21,346,189
Fixed-rate collateralized mortgage obligations-
Insured 7,444,587 10,505,463 25,588,113 31,454,375
Fixed-rate collateralized mortgage obligations-
originated loans 6,993,622 6,252,522 20,236,880 8,214,837
Fixed-rate senior unsecured notes 2,422,918 2,429,137 7,264,134 7,260,484
Variable-rate secured borrowings-CMBS 12,696,769 17,852,948 39,221,197 44,028,716
Other financing facilities 1,782,362 998,342 5,211,072 2,043,701
Total interest expense 46,426,623 48,990,493 139,548,225 114,348,302
-------------- --------------- ------------- -------------
Net interest margin 22,556,435 22,927,186 69,785,288 60,940,111
-------------- --------------- ------------- -------------
Equity in earnings from investments 784,398 1,604,836 1,055,045 7,272,272
Other income 448,941 1,060,487 1,872,481 3,871,685
Net gains on mortgage security dispositions 318,788 1,222,504 2,286,331 1,386,652
Gain on originated loan dispositions 114,543 -- 392,279 --
General and administrative expenses (2,719,847) (4,639,864) (9,003,036) (10,694,471)
Gain on installment note -- (331,831) -- --
Loss on warehouse obligation (36,328,173) -- (36,328,173) --
Loss on property foreclosure (319,104) -- (319,104) --
Reorganization Items (1,241,899) -- (11,892,484) --
--------------- ---------------- -------------- --------------
(38,942,353) (1,083,868) (51,936,661) 1,836,138
Tax basis (Loss) income before preferred
dividends $ (16,385,918) 21,843,318 17,848,627 62,776,249
Dividends accrued or paid on preferred shares (1,400,297) (1,942,377) (4,182,792) (5,499,881)
Tax basis (Loss) income available to common
shareholders $ (17,786,215) 19,900,941 13,665,835 57,276,368
*Net of minority interest, where applicable
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TAX BASIS (LOSS) INCOME PER SHARE:
Total tax basis (loss) income per share $ (0.33) $ 0.41 $ 0.26 $ 1.22
Weighted Average Shares 53,553,161 48,504,819 53,553,161 46,919,645
- ---------------------------------------------------------------------------------------------------------------------------------
Dividends Paid on common shares $ -- 0.40 -- 1.17
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
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CRIIMI MAE Inc.
<TABLE>
<CAPTION>
For the three months ended For the nine months ended
September 30, September 30,
1999 1998 1999 1998
--------------- --------------- ----------------- ----------------
<S> <C> <C> <C> <C>
FINANCIAL STATEMENT NET INCOME (LOSS) (ON A CONSOLIDATED BASIS):
Interest Income:
Subordinated CMBS $ 38,786,620 $ 38,880,750 $ 115,690,376 $ 105,319,710
Insured Mortgage Securities 8,034,760 10,662,386 25,424,098 33,528,290
Originated loans 8,615,000 8,869,367 26,103,642 11,619,062
--------------- ---------------- ----------------- ----------------
Total interest income 55,436,380 58,412,503 167,218,116 150,467,062
--------------- ---------------- ----------------- ----------------
Interest and related expenses:
Fixed-rate collateralized bond
obligations-CMBS 6,301,697 2,206,724 15,750,983 7,375,905
Fixed-rate collateralized mortgage
obligations-insured 7,813,936 9,892,249 24,523,097 30,546,774
Fixed-rate collateralized mortgage
obligations-originated loans 7,059,676 6,369,272 20,309,804 8,367,438
Fixed-rate senior unsecured notes 2,281,251 2,429,137 6,843,753 7,260,484
Variable-rate secured borrowings-CMBS 12,659,064 17,778,579 39,026,518 43,637,039
Other financing facilities 1,767,577 998,342 5,166,265 1,941,800
--------------- --------------- ----------------- -----------------
Total interest expense 37,883,201 39,674,303 111,620,420 99,129,440
--------------- ---------------- ----------------- ----------------
Net interest margin 17,553,179 18,738,200 55,597,696 51,337,622
--------------- ---------------- ----------------- ----------------
Gain on sale of CMBS -- (340,281) -- 28,800,408
Equity in earnings (losses) from
investments 260,199 (57,546) (1,225,417) 2,187,150
Other income 448,941 1,060,595 1,872,481 3,872,576
Net gains on mortgage security
dispositions 265,789 966,654 1,851,601 920,820
Gains on originated loan dispositions 74,616 -- 234,826 --
General and administrative expenses (2,702,353) (4,636,806) (8,953,507) (10,667,797)
Amortization of assets acquired in
the Merger (719,394) (719,394) (2,158,182) (2,158,182)
Loss on warehouse obligation (1,074,505) (17,630,390) (8,000,000) (17,630,390)
Unrealized loss on reverse repurchase
obligation -- (4,091,346) -- (4,091,346)
Reorganization Items (4,606,002) -- (15,552,783) --
--------------- ---------------- ----------------- ----------------
(8,052,709) (25,448,514) (31,930,981) 1,233,239
Minority interest in net income of
consolidated subsidiary -- 1,312 -- (40,052)
Net Income ( Loss) before dividends
accrued or paid on preferred shares 9,500,470 (6,709,002) 23,666,715 52,530,809
Dividends accrued or paid on preferred
shares (1,400,297) (1,942,377) (4,182,792) (5,499,881)
Net Income (Loss) available to common
shareholders $ 8,100,173 $ (8,651,379) $ 19,483,923 $ 47,030,928
- --------------------------------------------------------------------------------------------------------------------------
FINANCIAL STATEMENT EARNINGS PER SHARE:
Total GAAP basis income (loss) per
share-Basic $ 0.15 $ (0.18) $ 0.37 $ 1.02
Weighted Average Shares-Basic 53,553,161 48,298,007 53,373,719 46,178,885
Total GAAP basis income (loss) per
share-Diluted $ 0.14 $ (0.18) $ 0.33 $ 0.98
Weighted Average Shares -Diluted 61,759,810 48,298,007 61,171,289 49,113,845
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
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CRIIMI MAE Inc.
Balance Sheet Data:
<TABLE>
<CAPTION>
As of As of
September 30,1999 December 31, 1998
<S> <C> <C>
Subordinated CMBS $ 1,216,002,889 $ 1,274,185,678
Insured Mortgage Securities $ 410,356,899 488,095,221
Investment in Originated Loans $ 481,499,820 $ 499,076,030
Total assets $ 2,347,148,530 $ 2,437,917,953
Shareholders' Equity $ 258,548,264 $ 307,876,905
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</TABLE>
