<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1997
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _________ to ____________
Commission file number 1-10899
Kimco Realty Corporation
(Exact name of registrant as specified in its charter)
Maryland 13-2744380
(State of incorporation) (I.R.S. Employer Identification No.)
3333 New Hyde Park Road, New Hyde Park, NY 11042-0020
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code (516)869-9000 Securities
registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
Common Stock, par value $.01 per share New York Stock Exchange
Depositary Shares, each representing
one-tenth of a share of 7-3/4% Class A
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange
Depositary Shares, each representing
one-tenth of a share of 8-1/2% Class B
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange
Depositary Shares, each representing
one-tenth of a share of 8-3/8% Class C
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
(Title of class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [_]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
The aggregate market value of the voting stock held by nonaffiliates of the
registrant was approximately $1.14 billion based upon the closing price on the
New York Stock Exchange for such stock on February 27, 1998.
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
40,416,795 shares as of February 27, 1998.
<PAGE>
The following items of the Registrant's Form 10-K for the year ended December
31, 1997 are hereby amended in their entirety as follows:
ITEM 10. Directors and Executive Officers of the Registrant.
DIRECTORS OF THE REGISTRANT
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
NAME AGE EMPLOYMENT AND FIVE YEAR EMPLOYMENT HISTORY
- ----------------------------------------------------- --- -----------------------------------------------------
<S> <C> <C>
Martin S. Kimmel..................................... 82 Chairman (Emeritus) of the Board of Directors of
Kimco since November 1991; Chairman of the Board of
Directors of Kimco for more than five years prior
to such date. Founding member of Kimco's
predecessor in 1966.
Milton Cooper........................................ 69 Chairman of the Board of Directors of Kimco since
November 1991; Director and President of Kimco for
more than five years prior to such date. Founding
member of Kimco's predecessor in 1966.
Richard G. Dooley.................................... 68 Director of Kimco since December 1991. Consultant to,
and from 1978 to 1993, Executive Vice President and
Chief Investment Officer of Massachusetts Mutual
Life Insurance Company.
Michael J. Flynn..................................... 62 Vice Chairman of the Board of Directors of Kimco
since January 1996 and, since January 1997,
President and Chief Operating Officer; Director of
Kimco since December 1991. Chairman of the Board
and President of Slattery Associates, Inc. for more
than five years prior to joining Kimco in 1996.
Joe Grills........................................... 62 Director of Kimco since January 1997. Chief
Investment Officer for the IBM Retirement Funds
from 1986 to 1993.
Frank Lourenso....................................... 57 Director of Kimco since December 1991. Executive Vice
President of The Chase Manhattan Bank ("Chase
Bank", and successor by merger to Chemical Bank,
N.A.) since 1990. Senior Vice President of Chase
Bank for more than five years prior to that time.
</TABLE>
<PAGE>
Mr. Cooper is also a director of Getty Realty Corp. and Blue Ridge Real
Estate/Big Boulder Corporation and a trustee of MassMutual Corporate Investors
and MassMutual Participation Investors. He is also a member and the past
Chairman of the Board of Governors of the National Association of Real Estate
Investment Trusts and is a former chairman of the Shopping Center Committee of
the Real Estate Board of New York, Inc.
Mr. Dooley is also a director of Advest Group, Inc., Hartford Steam Boiler
Inspection and Insurance Co. and Jefferies Group, Inc. and a trustee of
MassMutual Corporate Investors and MassMutual Participation Investors.
Mr. Flynn is also Chairman of the Board of Directors of Blue Ridge Real
Estate/Big Boulder Corporation and a director of Slattery Associates, Inc.
Mr. Grills is also a Director of certain Merrill Lynch and Hotchkis and
Wyley Mutual Funds, Duke Management Company and the LaSalle Street Fund. He also
serves as a member of the Investment Advisory Committees of the State of New
York Common Retirement Fund and the Howard Hughes Medical Institute. Mr. Grills
is a member of the Financial Executives Institute Committee on Investment of
Employee Benefit Assets, its executive committee and is a former chairman of
that committee.
All directors of Kimco serve terms of one year and until the election and
qualification of their respective successors.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following table sets forth information with respect to the six
executive officers of the Company as of April 14, 1998.
<TABLE>
<CAPTION>
Name Age Position
- ---- --- --------
<S> <C> <C>
Milton Cooper 69 Chairman of the Board of Directors and
Chief Executive Officer
Michael J. Flynn 62 Vice Chairman of the Board of Directors,
President and Chief Operating Officer
Joseph V. Denis 46 Vice President - Construction
Bruce M. Kauderer 51 Vice President - Legal, General Counsel
and Secretary
Michael V. Pappagallo 39 Vice President - Chief Financial Officer
Alex Weiss 40 Vice President - Management Information
Systems
</TABLE>
Michael J. Flynn has been President and Chief Operating Officer since January 2,
1997, Vice Chairman of the Board of Directors since January 2, 1996 and a
Director of the Company since December 1, 1991. Mr. Flynn was Chairman of the
Board and President of Slattery Associates, Inc. for more than five years prior
to joining the Company.
Joseph V. Denis has been a Vice President of the Company since June 1993. Mr.
Denis was President and Chief Operating Officer of Konover Construction Company,
and previously held various positions with such company as a project and
construction manager, for more than five years prior to joining the Company in
June 1993.
Bruce M. Kauderer has been a Vice President of the Company since June 1995 and
since December 15, 1997, General Counsel and Secretary of the Company. Mr.
Kauderer was a founder of and partner with Kauderer & Pack, P.C. from 1992 to
June 1995 and a Partner with Fink Weinberger, P.C. for more than five years
prior to 1992.
Michael V. Pappagallo has been a Vice President and Chief Financial Officer of
the Company since May 27, 1997. Mr. Pappagallo was Chief Financial Officer of
GE Capital's Commercial Real Estate Financial and Services business from
September 1994 to May 1997 and held various other positions within GE Capital
for more than five years prior to joining the Company.
Alex Weiss has been a Vice President of the Company since 1988.
The executive officers of the Company serve in their respective capacities for
approximate one-year terms and are subject to re-election by the Board of
Directors, generally at the time of the Annual Meeting of the Board of
Directors following the Annual Meeting of Stockholders.
<PAGE>
Item 11. Executive Compensation
EXECUTIVE COMPENSATION AND TRANSACTIONS WITH MANAGEMENT AND OTHERS
Executive Compensation. The following table sets forth the summary
compensation of the Chairman of the Board of Directors (and Chief Executive
Officer) and the four other most highly paid executive officers of Kimco (the
"Named Executive Officers") for calendar years 1997, 1996 and 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
-------------------------------------------------- -------------------------
(A) (B) (C) (D) (E) (F) (G) (I)
RESTRICTED
NAME AND PERIOD OTHER ANNUAL STOCK ALL OTHER
PRINCIPAL POSITION ENDED SALARY($) BONUS($) COMPENSATION($)(1) AWARDS($) OPTIONS(#)(2) COMPENSATION($)(3)
- ------------------------------ ------ --------- -------- ------------------ ---------- ------------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Milton Cooper ................ 12/97 283,000 100,000 -- -- (4) 8,190
Chief Exec. Officer and 12/96 282,500 100,000 -- -- (4) 8,190
Chairman of the Board of 12/95 282,500 100,000 -- -- (4) 3,780
Directors
Michael J. Flynn(5) .......... 12/97 358,000 100,000 -- -- 73,000 4,563
Vice Chairman of the Board 12/96 350,000 100,000 -- 934,388(6) 73,000 4,563
of Directors and President & 12/95 -- -- -- -- 75,000 --
Chief Operating Officer
since January 1997
Joseph V. Denis .............. 12/97 157,500 112,500 -- -- 12,500 870
Vice President-Construction 12/96 157,500 75,000 -- -- 12,500 870
12/95 157,500 75,000 -- -- 18,750 510
Bruce M. Kauderer(5) ......... 12/97 208,000 20,000 -- -- 18,750 1,872
Vice President-Legal and, 12/96 179,543 45,000 -- -- 18,750 1,296
since December 15, 1997, 12/95 94,231 13,355 -- -- 41,250 392
General Counsel and
Secretary
Michael V. Pappagallo(5) ..... 12/97 148,539 51,667 -- -- 100,000 429
Chief Financial Officer 12/96 -- -- -- -- -- --
since May 1997 12/95 -- -- -- -- -- --
</TABLE>
- ------------------
(1) No named officer received perquisites or other personal benefits aggregating
more than the lesser of 10% of annual salary and bonus or $50,000.
(2) Options to acquire shares of Kimco Common Stock at exercise prices equal to
the fair market value on the dates of grant.
(3) The amounts shown represent the value of Kimco paid group term life
insurance premiums.
(4) Mr. Cooper is ineligible to participate in the Kimco Stock Option Plan for
so long as he serves as a member of the Executive Compensation Committee.
(5) See 'Executive Compensation and Transactions with Management and
Others--Employment Contracts.'
(6) Restricted stock award covering 37,500 shares of Kimco Common Stock valued
at $1,321,875 based upon the closing price on the NYSE on December 31, 1997.
Mr. Flynn is eligible to receive dividends on such restricted shares at such
times and in such amounts as may be declared by the Board of Directors with
respect to all shares of Kimco Common Stock then outstanding.
Note: Robert P. Schulman, formerly the Senior Vice President and Secretary of
Kimco through December 15, 1997, did not receive compensation in such
capacity. Mr. Schulman, principal in the Law Offices of Robert P.
Schulman, received $250,000 for legal services rendered to Kimco during
each of years 1997, 1996 and 1995. In addition, Mr. Schulman was granted
options to acquire 15,000 shares of Kimco Common Stock during 1995 at an
exercise price of $24.92, equal to the fair market value of such shares
on the date of grant. Kimco paid group term life insurance premiums
valued at $14,664, $8,190 and $8,190, on behalf of Mr. Schulman during
years 1997, 1996 and 1995, respectively.
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information on options to acquire shares of
Kimco Common Stock granted to the Named Executive Officers during 1997.
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE AT
ASSUMED ANNUAL RATES
OF
STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(1)
----------------------------------------------- ----------------------
(A) (B) (C) (D) (E) (F) (G)
% OF TOTAL
OPTIONS
GRANTED TO
OPTIONS EMPLOYEES EXERCISE
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#)(2) YEAR ($/SH) DATE 5% ($) 10% ($)
- ------------------------------------------ ------- ---------- -------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Milton Cooper............................. (3) (3) (3) (3) (3) (3)
Michael J. Flynn.......................... 73,000 15.5 31.75 11/03/07 1,457,810 3,393,800
Michael V. Pappagallo..................... 50,000 10.6 31.125 05/01/07 978,500 2,480,000
50,000 10.6 31.75 11/03/07 998,500 2,530,000
Joseph V. Denis........................... 12,500 2.7 31.75 11/03/07 249,625 632,500
Bruce M. Kauderer......................... 18,750 4.0 31.75 11/03/07 374,438 948,750
</TABLE>
- ------------------
(1) Assumed annual rates of stock price appreciation, as determined by the
Commission, for illustrative purposes only. Actual stock prices will vary
from time to time based upon market factors and Kimco's financial
performance. No assurance can be given that such rates will be achieved.
(2) Options become exercisable one-third on each of the first three
anniversaries of the date of grant.
(3) Mr. Cooper is ineligible to participate in the Kimco Stock Option Plan for
so long as he serves as a member of the Executive Compensation Committee.
AGGREGATED OPTION EXERCISES IN LAST
FISCAL YEAR AND FISCAL YEAR END OPTION VALUES
The following table provides information on options to acquire shares of
Kimco Common Stock exercised in 1997 by the Named Executive Officers, and the
value of each such officer's unexercised options to acquire shares of Kimco
Common Stock outstanding at December 31, 1997.
<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
YEAR END (#) YEAR-END ($)(1)
SHARES ACQUIRED VALUE ------------------ --------------------
NAME ON EXERCISE (#) REALIZED ($) EXER. UNEXER. EXER. UNEXER.
- ----------------------------------------- --------------- ------------ ------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Milton Cooper............................ (2) (2) (2) (2) (2) (2)
Michael J. Flynn......................... -- -- 101,333 146,667 1,009,318 848,092
Michael V. Pappagallo.................... -- -- (3) 100,000 (3) 381,000
Joseph V. Denis.......................... 6,500 72,000 70,417 27,083 908,002 165,561
Bruce M. Kauderer........................ -- -- (3) 78,750 (3) 582,488
</TABLE>
- ------------------
(1) Based upon the closing price of Kimco Common Stock on the NYSE on December
31, 1997 of $35.25 per share.
(2) Mr. Cooper is ineligible to participate in the Kimco Stock Option Plan for
so long as he serves as a member of the Executive Compensation Committee.
(3) See 'Executive Compensation and Transactions with Management and
Others--Employment Contracts.'
Note: Robert P. Schulman, formerly the Senior Vice President and Secretary of
Kimco through December 15, 1997, holds options to acquire 71,250 shares of
Kimco Common Stock as of December 31, 1997. Options to acquire a total
66,250 shares were exercisable as of such date. Mr. Schulman's 66,250
exercisable and 5,000 unexercisable options had values of $923,613 and
$51,650, respectively, based upon the closing price of Kimco Common Stock
on the NYSE on December 31, 1997 of $35.25 per share.
<PAGE>
Employment Contracts. In May 1995, Kimco entered into an employment
agreement with Mr. Bruce M. Kauderer, Vice President--Legal, which provided for
a minimum annual base salary and bonus of $175,000 and $25,000, respectively,
and the issuance of options to acquire 37,500 shares of Kimco's Common Stock at
an exercise price of $25.75 per share, the market price on June 19, 1995, the
commencement date of his employment. The standard provisions of the Kimco Stock
Option Plan provide that options granted vest one-third on each of the first
three anniversaries of the date of grant, however, options first become
exercisable only after the optionee has completed a three-year length of service
requirement. Notwithstanding these provisions, should Mr. Kauderer's employment
with Kimco terminate before such options become exercisable, he is nonetheless
entitled to receive a cash payment equal to the value of those options that
would have otherwise ratably vested at the time his employment terminates. The
agreement further provides that should Mr. Kauderer's employment be terminated
(other than of his own volition) prior to June 19, 2005, Kimco will pay, as an
agreed one-time severance payment, an amount equal to the excess of (a) Mr.
Kauderer's most recent annual salary plus bonus (but not less than $200,000),
over (b) the value (i) realized by Mr. Kauderer upon the exercise of any options
granted to acquire shares of Kimco's stock in excess of (ii) Mr. Kauderer's most
recent annual salary plus bonus (but not less than $200,000).
In November 1995, Kimco entered into a three-year employment agreement with
Mr. Michael J. Flynn pursuant to which Mr. Flynn began to serve as Vice Chairman
of the Board of Directors effective January 2, 1996. Mr. Flynn assumed the
additional responsibilities of President and Chief Operating Officer in January
1997. In accordance with this employment agreement, Mr. Flynn is to receive
$450,000 per annum ($350,000 base salary and $100,000 guaranteed bonus) as
compensation for his services. In addition, Mr. Flynn received a grant of 37,500
shares of restricted Kimco Common Stock which vest in three equal installments,
one-third on each of January 2, 1997, 1998 and 1999. In the event of, and
depending upon the reasons for, a termination of Mr. Flynn's employment with
Kimco prior to such dates, (i) any such nonvested shares would either vest or
Mr. Flynn would receive, generally in lieu of the value thereof, cash severance
payments, and (ii) Mr. Flynn would receive the greater of (a) the remaining
compensation due through the term of his employment agreement, or (b) $450,000.
The agreement further provides that Mr. Flynn be granted options to acquire
75,000 shares of Kimco Common Stock at an exercise price of $24.917 per share,
the market price on the date of grant. These stock options are to be considered
incentive stock options, as defined in and to the extent permitted under the
Kimco Stock Option Plan, and otherwise shall be non-qualified options. Options
with respect to 37,500 of these shares shall vest in three equal installments
upon each of the first three anniversaries of the date of grant. Options with
respect to the remaining 37,500 shares shall vest in three equal installments
upon the day prior to each of the first three anniversaries of the date of
grant, but only if the average of the closing prices of a share of the Kimco
Common Stock (on the principal exchange on which such stock is then traded)
during any twenty consecutive day trading period equals or exceeds $33.34.
In April 1997, Kimco entered into a two-year employment agreement with Mr.
Michael V. Pappagallo pursuant to which Mr. Pappagallo began to serve as Chief
Financial Officer effective May 27, 1997. In accordance with this employment
agreement, Mr. Pappagallo is to receive $400,000 per annum ($250,000 base salary
and $150,000 guaranteed bonus) as compensation for his services. The agreement
further provides that Mr. Pappagallo be granted options to acquire 50,000 shares
of Kimco Common Stock at an exercise price equal to the market price on the date
of grant. These stock options are to be considered incentive stock options, as
defined in and to the extent permitted under the Kimco Stock Option Plan, and
otherwise shall be non-qualified options. Options with respect to these shares
shall vest in three equal installments upon each of the first three
anniversaries of the date of grant. In the event of, and depending upon the
reasons for, a termination of Mr. Pappagallo's employment with Kimco prior to
such dates, (i) any such nonvested shares would become 100% vested as of the
termination date and (ii) Mr. Pappagallo would receive the remaining
compensation due through the term of his employment agreement.
<PAGE>
COMPENSATION OF DIRECTORS
Members of the Board of Directors and Committees thereof who are not also
employees of Kimco receive an annual fee of $12,000, plus fees of $1,000 for
attending each regular or special meeting of the full Board. Directors, other
than Mr. Kimmel, who are not also employees of Kimco, receive $500 for attending
Committee meetings. Pursuant to such arrangements, each of Messrs. Kimmel,
Dooley, Lourenso and Grills received directors' fees of $18,000, $18,500,
$18,500 and $18,000 respectively, during 1997. Employees of Kimco who are also
Directors are not paid any directors' fees.
Effective January 1, 1998, the annual fees for the non-employee members of
the Board of Directors of Kimco was increased to $24,000 plus fees of $2,000 for
attending each regular or special meeting of the full Board of Directors of
Kimco. Fees for attending Committee meetings remain at $500.
During November 1995, 1996 and 1997, Kimco granted each then non-employee
Director (other than (a) Mr. Kimmel, and (b) Mr. Flynn with regard to 1995)
options to acquire 7,500 shares of Kimco Common Stock at $24.92, $28.375 and
$31.75 per share, respectively, the market prices on the dates of such option
grants. See 'Executive Compensation and Transactions with Management and
Others--Executive Compensation and Employment Contracts' for information
concerning stock options granted to Mr. Flynn during 1995, 1996 and 1997. Kimco
intends to grant non-employee Directors, other than Mr. Kimmel, options to
acquire an additional 7,500 shares during November 1998 at the then current
market price.
Mr. Kimmel receives $50,000 per annum as payment for consulting services
rendered to, and reimbursement of certain expenses incurred on behalf of, Kimco.
Item 12. Security Ownership Of Certain Beneficial Owners And Management
The following table sets forth certain information available to Kimco as of
April 14, 1998 with respect to shares of Kimco Common Stock and depositary
shares representing Kimco Class A Preferred Stock, Kimco Class B Preferred Stock
and Kimco Class C Preferred Stock (i) held by those persons known to Kimco to be
the beneficial owners (as determined under the rules of the Commission) of more
than 5% of such shares and (ii) held, individually and as a group, by the
Directors and executive officers of Kimco:
<TABLE>
<CAPTION>
SHARES OWNED PERCENT
BENEFICIALLY(#) OF CLASS(%)
---------------------------------------- ---------------------------------
NAME & ADDRESS (WHERE REQUIRED) DEPOSITARY DEPOSITARY
OF BENEFICIAL OWNER COMMON STOCK SHARES COMMON STOCK SHARES
- ------------------------------------------ --------------- ----------------- ------------ -----------------
<S> <C> <C> <C> <C>
Milton Cooper 4,433,776(1)(6) -- 10.8 --
c/o Kimco Realty Corporation
3333 New Hyde Park Rd.
New Hyde Park, New York 11042
Cohen & Steers Capital 4,378,900 -- 10.7 --
Mgmt. Inc.
757 Third Avenue
New York, New York 10017
<PAGE>
Martin S. Kimmel 2,689,184(2) --(3) 6.6 --(3)
c/o Kimco Realty Corporation
3333 New Hyde Park Rd.
New Hyde Park, New York 11042
Fleming Capital Mgmt. 2,548,059 -- 6.2 --
320 Park Avenue
New York, New York 10027
Helen Kimmel 1,929,962(4) 157,000(4) 4.7 5.2(4)
445 Park Avenue
New York, New York 10022
Alex Weiss 177,865(5) -- * --
Michael J. Flynn 149,590 -- * --
Joseph V. Denis 70,400 -- * --
Richard G. Dooley 66,746 -- * --
Frank Lourenso 53,678 -- * --
Michael V. Pappagallo 16,667 -- * --
Joe Grills 16,000 -- * --
Bruce M. Kauderer 46,835 -- * --
All Directors and executive officers 7,720,741(6) -- 18.9 --
as a group (10 persons)
</TABLE>
- ------------------
* Less than 1%
(1) Includes 1,070,889 shares held by Mr. Cooper as trustee for the benefit of
Mr. Kimmel's son. Does not include 255,212 shares held by adult members of
Mr. Cooper's family, as to all of which shares Mr. Cooper disclaims
beneficial ownership.
(2) Does not include 1,070,889 shares held in trust by Mr. Cooper for Mr.
Kimmel's son or 739,211 shares held by Helen Kimmel, his wife, as to all of
which shares Mr. Kimmel disclaims beneficial ownership. Also, does not
include 1,190,751 shares held by foundations and trusts for which Mrs.
Kimmel is a trustee, as to all of which shares Mr. Kimmel disclaims
beneficial ownership.
(3) Does not include 157,000 depositary shares representing ownership of Kimco
Class A Preferred Stock held by Helen Kimmel, his wife, and a foundation for
which Mrs. Kimmel is a trustee, as to all of which shares Mr. Kimmel
disclaims beneficial ownership.
(4) Does not include 2,689,184 shares held by Mr. Kimmel, her husband, or
1,070,889 shares held in trust by Mr. Cooper for Mr. Kimmel's son, as to all
of which shares Mrs. Kimmel disclaims beneficial ownership. All depositary
shares and Percent of Class represent ownership of Kimco Class A Preferred
Stock.
(5) Does not include 1,154 shares held by Mrs. Linda Weiss, wife of Mr. Alex
Weiss, an executive officer of Kimco, as to all of which shares Mr. Weiss
disclaims beneficial ownership.
(6) Does not include 383,546 shares held by KC Holdings, Inc., a related,
private corporation in which Mr. Cooper holds a controlling interest. See
"Certain Relationships and Related Transactions--Transactions with KC
Holdings, Inc."
<PAGE>
Item 13. Certain Relationships And Related Transactions
Joint Ventures. Certain members of Kimco's management hold investments in
certain real estate joint ventures or limited partnerships to which Kimco is a
party. Such investments predate Kimco's IPO and, in each case, Kimco controls or
directs the management of the joint venture or limited partnership. Any material
future transactions involving
<PAGE>
these joint ventures or partnerships require the approval of a majority of
disinterested directors of Kimco.
Transactions with KC Holdings, Inc. To faciliate the IPO, Kimco transferred
its interests in 46 shopping center properties to a newly-formed corporation, KC
Holdings, Inc. ("KC Holdings"), and subsidiaries of KC Holdings. The stock of KC
Holdings is owned by the stockholders of Kimco prior to the IPO. All of the real
estate interests owned by KC Holdings and its subsidiaries are subject to
purchase options held by Kimco.
As of April 14, 1998, KC Holdings' subsidiaries had conveyed 14 shopping
center properties back to Kimco and had disposed of 10 additional centers in
transactions with third parties. The members of Kimco's Board of Directors who
are not also stockholders of KC Holdings unanimously approved Kimco's
acquisition of all fourteen shopping center properties that have been conveyed
back to Kimco.
Kimco is party to a management agreement pursuant to which it manages 18 of
KC Holdings' 22 shopping center properties under terms which Kimco believes are
no less favorable than would be obtained in negotiations with an independent
third party. The remaining four shopping center properties are owned in two
separate joint ventures and are managed by unaffiliated joint venture partners.
The management agreement was approved by a majority of Kimco's Directors who are
not also stockholders of KC Holdings. Management fees paid by KC Holdings to
Kimco totaled approximately $.6 million during 1997.
Messrs. Kimmel and Cooper, Directors of Kimco, are stockholders of KC
Holdings.
Transactions with Ripco Real Estate Corporation. During 1997, Kimco paid a
total of approximately $8,750 in brokerage commissions to Ripco Real Estate
Corporation ("Ripco") for services rendered by Ripco as leasing agent in one
transaction. Mr. Todd Cooper, a son of Mr. Milton Cooper, Chief Executive
Officer and Chairman of the Board of Directors of Kimco, is an officer and an
approximate 37% stockholder of Ripco. Such commissions are customarily paid by
landlords in comparable commercial leasing transactions, and Kimco believes that
the commissions paid by it to Ripco were at or below the customary rates for the
leasing services rendered.
Relationship with Chase Bank. Mr. Lourenso, an Executive Vice President of
Chase Bank, has been a Director of Kimco since December 1991. Kimco has
maintained its principal banking relationship with Chase Bank. Chase Bank,
together with a consortium of six additional banks, has provided Kimco with a
$100 million unsecured revolving credit facility (the "Facility") which is
scheduled to expire in June 2000. Additionally, Chase Bank and one other bank
have provided Kimco with an additional $150 million interim unsecured revolving
credit facility which will expire in June 1998. No borrowings were outstanding
under the Facility at December 31, 1997.
Mr. Paul Dooley, Manager of Real Estate Tax Administration and Insurance
for Kimco, is the son of Mr. Richard G. Dooley, a director of Kimco. Mr. Paul
Dooley was paid total cash compensation of $105,761 in salary in 1997 as an
employee of Kimco. In addition, he was granted 5,000 options in 1997 pursuant to
the Kimco Stock Option Plan.
Indebtedness of Management. The following table sets forth information
with respect to indebtedness of Directors and executive officers to Kimco during
1997.
<TABLE>
<CAPTION>
LARGEST
AGGREGATE INDEBTEDNESS
OUTSTANDING AMOUNT INTEREST
DURING 1997 PURPOSE OF OUTSTANDING RATE
NAME AND PRINCIPAL POSITION ($) INDEBTEDNESS ($) (%)
- ------------------------------------------------- ---------------------- --------------- ----------- --------
<S> <C> <C> <C> <C>
Michael J. Flynn................................. 496,750(2) Stock purchase 496,750 6.0
Vice Chairman of the Board of Directors.
President and Chief Operating Officer
since January 1997
Alex Weiss....................................... 225,938(1) Stock purchase 219,280 6.0
Vice President - Management
Information Systems
</TABLE>
- ------------------
(1) Loan extended during 1992 to supplement available margin loans and partially
fund the purchase of 60,000 shares of the Kimco Common Stock by Mr. Weiss.
The stock purchase loan is collateralized by the shares of Kimco Common
Stock acquired and is scheduled to be repaid over a term of eight years.
(2) Loan extended to Mr. Flynn during 1996 to fund the purchase of 10,000
outstanding shares of Kimco Common Stock and in 1997 to fund amounts
associated with a previously granted restricted stock award. This stock
purchase loan is collateralized by the shares of Kimco Common Stock acquired
and is repayable, commencing in 1999, over an approximate term of eight
years.
Indebtedness for Affiliate. During 1997, Kimco loaned to its preferred
stock affiliate, Kimco Realty Services, Inc., an aggregate amount of $12,000,000
evidenced by a series of notes due in the year 2000 at a rate of interest of 10%
per annum. Kimco believes that the terms of such loans are no less favorable
than could have been obtained in an arm's length transaction with an unrelated
third party.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
KIMCO REALTY CORPORATION
(Registrant)
By: /s/ Milton Cooper
-----------------------
Milton Cooper
Chief Executive Officer
Dated: April 29, 1998
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Martin S. Kimmel Chairman (Emeritus) of April 29, 1998
- --------------------------- the Board of Directors
Martin S. Kimmel
/s/ Milton Cooper Chairman of the Board April 29, 1998
- --------------------------- of Directors and Chief
Milton Cooper Executive Officer
/s/ Michael J. Flynn Vice Chairman of the April 29, 1998
- --------------------------- Board of Directors,
Michael J. Flynn President and
Chief Operating Officer
/s/ Richard G. Dooley Director April 29, 1998
- --------------------------
Richard G. Dooley
/s/ Joe Grills Director April 29, 1998
- --------------------------
Joe Grills
/s/ Frank Lourenso Director April 29, 1998
- --------------------------
Frank Lourenso
/s/ Michael V. Pappagallo Chief Financial Officer April 29, 1998
- --------------------------
Michael V. Pappagallo
/s/ Glenn G. Cohen Treasurer April 29, 1998
- ---------------------------
Glenn G. Cohen
/s/ Toni Calandrino Controller April 29, 1998
- ---------------------------
Toni Calandrino
