SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K/A
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended December 31, 1994
Commission file number 1-8822
BEDFORD PROPERTY INVESTORS, INC.
(Exact name of Registrant as specified in its charter)
MARYLAND 68-0306514
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
270 Lafayette Circle, Lafayette, CA 94549
(Address of principal executive offices)
Registrant's telephone number, including area code (510)283-8910
Securities Registered Pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, par value $0.01 per share New York Stock Exchange
Pacific Stock Exchange
Securities Registered Pursuant to Section 12(g) of the Act: None
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. [ ]
The aggregate market value of the voting stock held by non-affiliates
of Registrant as of February 17, 1995, was approximately $24,746,000.
The number of shares of Registrant's common stock, par value $0.01 per
share, outstanding as of February 17, 1995, was 5,976,900.
<PAGE>
The undersigned Registrant hereby amends and supplements its Report on
Form 10-K, dated March 27, 1995, by adding the following thereto:
PART III
Item 10. Directors and Executive Officers of the Registrant.
Directors of the Company
All directors are elected to serve until their successors are duly
elected and qualify.
Shares
Business Experience DirectorBeneficially
Name Age During Past Five Years Since Owned(1)
Claude M.
Ballard 65 Chairman (1992-1994) and 1992 1,000
a member (since 1987)
of the Board of Rockefeller Center
Properties, Inc.(a real estate investment trust);
Limited Partner of The Goldman Sachs Group,
L.P. (since 1989); Limited Partner of Goldman
Sachs & Co. (1988-1989); Director of American
Building Maintenance Industries, Inc. (1981-1994)
(building maintenance); Director of CBL &
Associates (since 1993); Director of Taubman
Centers, Inc.(since 1993) (a real estate investment
trust); Trustee of Mutual Life Insurance Company
of New York (1989-1994); Chairman of Merit
Equity Partners, Inc. (since 1989) (property
acquisition and management); Director of Horizon
Hotels, Inc. (since 1990) (hotel ownership and
management).
Peter B.
Bedford 57 Chairman of the Board and 1992 1,511,825(2)
Chief Executive Officer of the
Company (since 1992); Chairman
of the Real Estate Center Advisory Board of the
Wharton School at the University of Pennsylvania
(1992-1994); Chairman of the Board of Kingswood
Realty Advisors, Inc. (1990-1994) (investment and
asset management); President of Bedford Properties
Holdings, Ltd. (formerly Bedford Properties,
Inc.) (since 1962) (real estate development
and property management); Director of BankAmerica
Corporation (since 1987); Director of Bixby Ranch
Company (since 1985) (a real estate investment
company).
Anthony Downs 64 Director of General Growth 1992 500
Properties, Inc. (since 1992)
(a real estate investment trust);
Senior Fellow at the Brookings Institution
(since 1977) (non-profit policy research
organization);
Director of Massachusetts Mutual Life Insurance Co.
(since 1993); Director of Pittway Corporation
(since 1971) (manufacturing company); Director
of the Urban Land Institute (since 1979); Director
of Urban Institute (since 1977); Director of NAACP
Legal Educational & Defense Fund, Inc. (since 1986);
Director of NHP Foundation (since 1991); Executive
Consultant to Salomon Brothers (1986-1994) and Aetna
Realty Investors (since 1977).
Anthony M.
Frank 63 Chairman of Acrogen, Inc. 1992 1,000
(since 1992) Director of Charles
Schwab & Co., Inc.;
Director of Irvine Apartment Communities, Inc.
(since 1993) (a real estate investment trust);
Director of General American Investors; Director
of Living Centers of America (retirement centers);
Director of Adia Temporary Services (1994);
Director of Temple-Inland (since 1992) (a
forest products company); Postmaster General
of the United States (1988-1992); Chief Executive
Officer of First Nationwide Bank (1971-1988).
Martin I.
Zankel,Esq. 60 Senior Partner of the law firm 1992 20,000
Bartko, Zankel, Tarrant & Miller
and predecessor firms (since
1979); Chairman of the Board and Chief Executive
Officer of Landsing Pacific Funds, Inc. (since 1992)
(a real estate investment trust).
(1) The percentage of the shares of Common Stock of the Company beneficially
owned by each director-nominee, other than Mr. Bedford as described below, is
equal to no more than 1% of the shares of Common Stock outstanding.
Additionally, each of these directors has exercisable options to acquire
70,000 shares. Voting power and investment power are not shared with others
unless specifically stated.
(2) Includes 100,000 shares owned by Mr. Bedford's daughter. Mr. Bedford thus
beneficially owns 1,511,825 shares of Common Stock of the Company in an
aggregate amount equal to 25.29% of the presently outstanding shares. Mr.
Bedford has sole voting power with respect to all of said shares.
Mr. Bedford has sole voting power with respect to 200,000 shares
owned by his two sons. Additionally, Mr. Bedford has exercisable options to
acquire 95,000 shares.
Executive Officers of the Company
The following four (4) persons serve as executive officers of the Company:
Shares
Principal Positions and Beneficially
Name Age Business Experience Owned
Peter B. Bedford 57 Chairman of the Board and 1,511,825
Chief Executive Officer
of the Company (since 1992);
Chairman of the Real Estate Center
Advisory Board of the Wharton
School at the University of
Pennsylvania (1992-1994); Chairman
of the Board of Kingswood Realty
Advisors, Inc. (1990-1994) (investment
and asset management); President of Bedford
Properties Holdings, Ltd. (formerly
Bedford Properties, Inc.) (since 1962)
(real estate development and property management);
Director of BankAmerica Corporation (since 1987);
Director of Bixby Ranch Company (since 1985) (a
real estate investment company).
Donald A. Lorenz 45 Executive Vice President of the 0
(since September 1994); Chief Executive
Officer of Tri-Ox,(a manufacturing
company) (1993-1994); Executive
Vice President of Bedford Holdings Ltd.
(1989-1993); Managing Partner of Armstrong,
Gilmour & Associates, (1979-1989)
(a certified public accounting firm).
Hanh Kihara 47 Controller of the Company 0(1)
(since 1993) Controller (1991-1993)
and Assistant Controller (1990-1991)
of Bedford Properties Holdings, Ltd.;
Manager of Armstrong, Gilmour
& Associates (1988-1990);
Certified Public Accountant
(since 1989).
Jay Spangenberg 32 Chief Financial Officer of 5,900(1)
the Company (since 1994) and Vice
President Finance (1993); Project
Manager of Kemper Real Estate
Management Company (1992-1993);
Assistant Treasurer of Bedford Properties,
Holdings, Ltd.(1990-1992);
Assistant Vice President of Bank
of America 1985-1990).
(1) In addition, each of these two executive officers has exercisable options
to acquire 8,750 shares.
Item 11 - Executive Compensation
Compensation of Executive Officers
The following table sets forth information regarding compensation paid
by the Company for services rendered during the past three years for the
Company's Chief Executive Officer and the two most highly compensated
executive officers of the Company who were employed by the Company as of the
December 31, 1994 (collectively, the "Named Executive Officers"). No
executive officer other than the Named Executive Officers earned more than
$100,000 in any year. The salaries of the two Vice Presidents-Acquisitions
were, as of December 31, 1994, paid by BPI Acquisitions, then a separate
division of the Company which was funded by Mr. Bedford. A separate
corporation, wholly-owned by Peter Bedford, has since been formed, and the
acquisition personnel are now employed directly by that entity. See "Certain
Relationships and Related Transactions -- Cost of Acquisitions." Prior to
July 1992, the Company's affairs were managed by Kingswood Realty Advisors,
Inc., and the Company had no salaried employees.
SUMMARY COMPENSATION TABLE
Securities Underlying
Annual Compensation(1) Options/SARS
Name and Principal Position Year Salary Options SARs
Management of Bedford Property
Investors:
Peter B. Bedford,
Chief Executive Officer(2) 1994 $156,013 10,000(3) -0-
50,000(4)
1993 $129,615 10,000(3) -0-
1992 -0- 50,000(3) -0-
Management of BPI Acquisitions:
John Papini,
Vice President-
Acquisitions(5) 1994 $147,988 20,000(6) 10,000
1993 $ 86,135 10,000(4) -0-
Robert E. Pester,
Vice President-
Acquisitions(7) 1994 $131,195 30,000(6) 10,000
_________________________
(1) The Company did not pay any bonuses to any of the Named Executive
Officers during the fiscal years covered by the table.
(2) Mr. Bedford did not commence employment with the Company until February
1993. He began serving as a director of the Company in December 1990.
(3) Represents stock options granted pursuant to the Directors' Stock Option
Plan.
(4) Represents stock options granted pursuant to the Employee Stock Option
Plan.
(5) Mr. Papini commenced employment with the Company in February 1993 and is
no longer employed by the Company.
(6) 10,000 of which represent either stock options or stock appreciation
rights ("SARs"), at the option of holder thereof, granted under the Employee
Stock Option Plan.
(7) Mr. Pester commenced employment with the Company in February 1994.
Employment Contract On February 16, 1993, the Company entered into an
employment agreement (the "Employment Agreement") with Mr. Bedford, Chairman
of the Board and Chief Executive Officer of the Company. Pursuant to the
Employment Agreement, the Company pays Mr. Bedford $150,000 on an annual
basis commencing February 17, 1993. Mr. Bedford devotes a majority of his
time to Company affairs. The Employment Agreement has a five-year term,
expiring February 17, 1998, providing for a one-year notice of cancellation or
severance equal to one year's salary.
Employee Stock Option Plan. A total of 1,800,000 shares of the
Company's Common Stock have been reserved for issuance under the Company's
Employee Stock Option Plan (the "Employee Stock Option Plan") adopted by the
Board of Directors in 1985 and amended and approved by the Company's
stockholders on June 9, 1993. The Employee Stock Option Plan expires by its
own terms in 2003.
The Employee Stock Option Plan provides for the grant of "incentive
stock options" within the meaning of Section 422 of the Internal Revenue Code,
non-qualified stock options and SARs to officers, key employees and
consultants of the Company. Incentive stock options may be granted only to
employees. The Employee Stock Option Plan is administered by the Compensation
Committee, which determines the terms of options and SARs granted, including
the exercise price, the number of shares subject to the option, and the
option's exercisability. Options granted to employees are exercisable upon
vesting, but typically vest over a four-year period.
The Employee Stock Option Plan requires that the exercise price of
incentive stock options be at least equal to the fair market value of such
shares on the date of grant and that the exercise price of non-qualified stock
options be equal to at least 85% of the fair market value of such shares on
the date of grant. The maximum term of options granted under the Employee
Stock Option Plan is ten years. Incentive stock options may not be granted to
any participant who owns stock possessing more than 10% of the voting rights
of the Company's outstanding capital stock.
SARs may be granted in conjunction with stock options granted under the
Employee Stock Option Plan and entitle the holder to receive the difference
between the fair market value and the exercise price of the Common Stock
receivable upon exercise of the underlying option. The value of a SAR may be
paid in cash or Common Stock, at the option of the Company. A SAR granted in
tandem with an incentive stock option may not be exercised if a previously
issued incentive stock option or related SAR held by such person remains
outstanding. The exercise of a SAR results in the termination of the related
option on a share-for-share basis. Shares covered by such terminated options
are not eligible for reissuance under the Employee Stock Option Plan.
Compensation of Directors
Directors for the Company not employed by the Company are currently paid
an annual retainer fee of $12,500 and an additional fee of $2,500 for each
Board meeting attended. Any Director attending in person a duly constituted
meeting of a committee of the Board of Directors of which such Director is a
member shall receive, in addition to any other fees to which he may be
entitled, a separate meeting attendance fee equal to $2,500 for his attendance
in person at any such committee meeting not held on the same day, the day
preceding or the day following a regular or special meeting of the Board of
Directors. Any Director of the Company who participates in a regular or
special meeting of the Board of Directors by conference telephone or similar
communications equipment shall receive $600 for each such meeting. Directors
are reimbursed for out-of-pocket expenses in connection with attendance at
meetings. To the extent a Director travels to conduct a site inspection of a
property to be acquired by the Company, such Director is paid $1,000 per day
and reimbursed for related travel expenses. Directors receive no other
compensation for their services on behalf of the Company (except under the
1992 Directors' Stock Option Plan).
1992 Directors' Stock Option Plan. The 1992 Directors' Stock Option
Plan (the "Directors' Plan") was approved by the stockholders on June 9, 1993.
Under the Directors' Plan, members of the Board of Directors are granted non-
qualified stock options with the aggregate number of such options not to
exceed 500,000. The Directors' Plan is administered by the Compensation
Committee of the Board of Directors of the Company. Pursuant to the
Directors' Plan, each first year director is granted 50,000 options on the
date of their first annual meeting and an additional 10,000 options on the
date of each successive annual meeting provided they are re-elected to the
Board. On May 20, 1992, subject to subsequent approval of the Directors' Plan
by the Company's stockholders, each of the five Directors was granted 50,000
options, each option representing the right to purchase one share of Common
Stock at an exercise price of the then market price (as defined in the
Directors' Plan) of $2.665 per share. On June 9, 1993, each of the same five
Directors was granted an additional 10,000 options at the then market price of
$3.856 per share. On May 18, 1994, each of the same five Directors was
granted an additional 10,000 options at the then market price of $6.483 per
share. Options granted under the Directors' Plan are exercisable six months
from the date of the grant. As of November 18, 1994, all 350,000 options
granted under the Directors' Plan were exercisable. As of March 31, 1995, no
options granted under the Directors' Plan had been exercised. As of March 31,
1995, the market value of Common Stock subject to options under the Directors'
Plan, as measured by the closing price on the New York Stock Exchange, was
$5.625 per share.
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee during 1994 were Messrs.
Downs, Frank and Zankel. None of these individuals was an officer or employee
of the Company at any time during the year ended December 31, 1994, nor has
any of these individuals ever been an officer of the Company or any of its
subsidiaries. In addition, none of the executive officers of the Company
served on the compensation committee of another entity or as a director of an
entity which employs any of the members of the Compensation Committee.
Compliance With Section 16
Mr. Bedford did not file a Form 4 in connection with certain transactions
involving the sale of shares held by Kingswood Realty Advisors, Inc., which
is now subject to bankruptcy proceedings. In addition, Mr. Bedford did not
file a Form 4 with respect to the transfer of shares in certain other
transactions. Mr. Bedford filed a Form 5 at year end reporting all of such
sales.
Option Grants
The following table sets forth certain information concerning
options/SARs granted during 1994 to the Named Executive Officers.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
% of Total Potential
Options/ Realizable Value
Number of SARs Exercise at Assumed
Securities Granted or Annual Rates
Underlying to Emp Base of Stock Price
Options in Price Appreciation
SARs Fiscal ($/ Expiration for Option Term(3)
Name Granted Year Share) Date 0% 5% 10%
<S>
Peter B. <C> <C> <C> <C> <C> <C> <C>
Bedford 10,000(1) 5.2% 6.483 11/18/99 0 17,910 39,580
50,000(2) 26.2% 7.00 5/18/99 0 96,700 213,700
John Papini 10,000(2) 5.2% 7.0 5/18/99 0 19,340 42,740
10,000(2) 5.2% 6.875 9/23/04 0 43,240 109,570
Robert E.
Pester 10,000(2) 5.2% 7.00 5/18/99 0 19,340 42,740
10,000(2) 5.2% 6.875 3/16/04 0 43,240 109,570
10,000(2) 5.2% 6.875 9/23/04 0 43,240 109,570
</TABLE>
(1) Stock Options granted pursuant to 1992 Directors Stock Option Plan,
which options vest and become exercisable six months from the date of
grant.
(2) Stock Options granted pursuant to Employee Stock Option Plan, which
options vest and become exercisable at a rate of 25% per year either from
the date of employment or the date of grant.
(3) Potential Realizable Value is based on the assumed growth rates shown
for each of the grants, over their option term of either five or ten years.
These potential values are listed in order to comply with Securities and
Exchange Commission regulations, and the Company cannot predict whether
these values will be achieved. Actual gains, if any, on stock option
exercises are dependent on the future performance of the stock.
In addition to the options indicated above, on May 18, 1994, 51,000
options were granted to officers and employees other than the Named Executive
Officers under the Company's Employee Stock Option Plan (the "Employee Plan")
at the then market price of $7.00 per share, the closing price on the New York
Stock Exchange on that day. Additionally on September 23, 1994, 30,000
options (or SARs, at the option of the holder) were granted at the then market
price of $6.875 per share. Such options vest and become exercisable at a rate
of 25% per year from either the date of employment or the date of grant. In
general, the Employee Plan provides that all options held by an officer or
employee shall be canceled upon termination of employment and after the
expiration of specified time periods during which the optionee may exercise
his or her options. As of March 31, 1995, the market value of Common Stock
subject to options under the Employee Plan, as measured by the closing price
on the New York Stock Exchange, was $5.625 per share. No stock options or
SARs were exercised in 1994.
Aggregate Option Values at Year-End 1994
No Named Executive Officer exercised any stock options or SARs in 1994.
The following table sets forth the number and aggregate dollar value of Named
Executive Officers' unexercised options at the end of 1994.
AGGREGATED OPTION/SAR
EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
Value of Securities
Number of Securities Unexercised in-the-
Underlying Unexercise Money Options at
Options/SARs at FY-End FY-End
Name Exercisable Unexercisable Exercisable Unexercisable
Peter B. Bedford 82,500 37,500 $158,190 $0
John Papini 5,000 25,000 $3,125 $9,375
Robert E. Pester 0 30,000 $0 $0
Item 12. Security Ownership of Certain Beneficial Owners and
Management.
The following table sets forth information as of April 30, 1995, with respect
to each person who is known by the Company to own beneficially more than 5% of
the shares of its Common Stock, and with respect to shares owned beneficially
by all directors and officers of the Company as a group:
Number of
Shares Percent
Beneficially Outstanding
Name and Address Owned Shares
Peter B. Bedford 1,511,825(1) 25.39%
270 Lafayette Circle
Lafayette, CA 94549
All Directors and Officers 1,551,225(2) 25.95%
as a group (10 persons)
(1)Includes 100,000 shares owned by Mr. Bedford's daughter.
(2) Additionally, the directors and officers as a group have exercisable
options to acquire 397,500 shares.
Item 13. Certain Relationship and Related Transactions.
Cost of Acquisitions
From February 1993 until December 31, 1994, all of the Company's activities
relating to debt and equity financings and the acquisition of new properties
(the "Acquisition Services") have been handled under an arrangement with Mr.
Bedford whereby he provides acquisition and financing personnel (the
"Acquisition Personnel"), allocable overhead costs, and the costs of all due
diligence conducted prior to an acquisition. Upon the completion of a
financing or the acquisition of a property, Mr. Bedford was paid a fee by the
Company equal to the lesser of either (a) 1-1/2% of the gross amount raised or
of the purchase price of the property, as the case may be, or (b) an amount
equal to (i) the aggregate amount of costs funded by Mr. Bedford through the
time of such acquisition or financing minus (ii) the aggregate amount of fees
previously paid to Mr. Bedford pursuant to such arrangement. In no event
would the aggregate amount of fees paid to Mr. Bedford exceed the aggregate
amount of costs funded by Mr. Bedford. Such fees were capitalized by the
Company as part of the direct costs of acquisition and financing activities.
As of December 31, 1994, the Company had paid Mr. Bedford an aggregate of
$903,000 pursuant to this arrangements, which was $712,000 less than the
amount of total acquisition and financing costs funded by Mr. Bedford.
Commencing as of January 1, 1995, the Acquisition Services have been performed
by a corporation wholly owned by Mr. Bedford. Accordingly, the Acquisition
Personnel previously employed by the Company are now employed by that
Corporation. The financial terms of the arrangement remain unchanged.
Other Transactions
The Company is leasing 2,400 square feet of industrial space on a month-to-
month basis at a market rental rate of $1,288 per month to a company wholly-
owned by Mr. Bedford.
During 1994, furniture and equipment was purchased from a company wholly owned
by Mr. Bedford. The purchase price of $69,000 was based on independent
valuations.
<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.
BEDFORD PROPERTY INVESTORS, INC.
By: /s/ Peter B. Bedford
Peter B. Bedford
Chairman of the Board and
Chief Executive Officer
Dated: May 1, 1995
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.
/s/ Peter B. Bedford May 1, 1995
Peter B. Bedford, Chairman of the Board
and Chief Executive Officer
/s/ Claude M. Ballard May 1, 1995
Claude M. Ballard, Director
/s/ Anthony Downs May 1, 1995
Anthony Downs, Director
/s/ Anthony M. Frank May 1, 1995
Anthony M. Frank, Director
/s/ Martin I. Zankel, Esq. May 1, 1995
Martin I. Zankel, Director
/s/ Jay Spangenberg May 1, 1995
Jay Spangenberg
Chief Financial Officer
/s/ Hanh Kihara May 1, 1995
Hanh Kihara, Controller
