<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 OR 15(b) of The Securities Exchange Act of 1934
<TABLE>
<S> <C>
Date of Report (Date of earliest event reported) February 18, 1997 (December 5, 1996)
---------------------------------------
</TABLE>
001-12910
- --------------------------------------------------------------------------------
(Commission File Number)
STORAGE USA, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Tennessee 62-1251239
- -------------------------------------------------- ----------------------------
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification Number)
10440 Little Patuxent Parkway, Columbia, Maryland 21044
- -------------------------------------------------- ----------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (410) 730-9500
--------------
<PAGE> 2
EXPLANATORY NOTE: Pursuant to Item 7(a)(4) of Form 8-K, this Form 8-K/A amends
the Company's Form 8-K filed on December 19, 1996, to include the historical
financial statements and pro forma financial information required by item 7(a)
and (b).
ITEM 5: OTHER EVENTS
As previously reported on December 19, 1996, Storage USA, Inc., (the "Company")
had, for the period October 16, 1996 through December 19, 1996, consummated the
acquisition of 26 self-storage facilities through SUSA Partnership, L.P.
("OP"), a limited partnership in which the Company is the general partner and
owns approximately a 95% interest. On December 31, 1996, the Company acquired
through OP an additional self-storage facility. The 27 facilities totaling
approximately 1,802,000 square feet are located in 9 states and were purchased
for approximately $104.4 million.
The Company managed, for a fee, the one facility acquired on November 26, 1996
(indicated with a *). All of the facilities were acquired with cash or units of
limited partnership interest in the OP ("Units"). The acquisitions were funded
by cash generated from operations, the issuance of Units, the issuance of $100
million of 7.125% Notes of SUSA Partnership, L.P., due November 1, 2003, the
assumption of certain mortgages payable, and borrowings under the Company's
lines of credit with The First National Bank of Chicago and First Tennessee
Bank. Each of the facilities acquired was used by the seller as a self-storage
facility prior to its acquisition by the Company, and the Company intends to
continue the use of all facilities for that purpose. The Company's management
determined the contract price through arms-length negotiations, after taking
into consideration such factors as: the age and condition of the facility; the
projected amounts of maintenance costs; anticipated capital improvements; the
facility's current revenues; comparable facilities competing in the applicable
market; market rental rates for comparable facilities; the occupancy rate of
the facility; and the estimated amount of taxes, utility costs, personnel
costs, and other anticipated expenses.
The following provides certain additional information concerning the 27
facilities acquired:
<TABLE>
<CAPTION>
LOCATION SELLER DATE OF ACQUISITION
<S> <C> <C>
Troy, Michigan NSS Michigan, LP October 16, 1996
Grand Rapids, Michigan NSS Michigan, LP October 16, 1996
Grandville, Michigan NSS Michigan, LP October 16, 1996
Mesa, Arizona A Advance Stor N Lock October 29, 1996
Sugarland, Texas C.W. Hurd, Jr. November 5, 1996
Nashville, Tennessee Haywood Lane Joint Venture November 5, 1996
Nashville, Tennessee Murfreesboro Road Joint Venture November 5, 1996
Mesa, Arizona White, Howell & Hall, LLC November 5, 1996
Birmingham, Alabama Colonial Realty, LP November 12, 1996
Fredricksburg, Virginia Westwood Self Storage Park, LP November 15, 1996
Fredricksburg, Virginia Four Mile Fork Self Storage November 15, 1996
Stafford, Virginia Aquin Self Storage, LP November 15, 1996
Charlottesville, Virginia RIO-29 Self Storage, LP November 15, 1996
Nashville, Tennessee Estate of E. Schatten & The Paul Gold Family Trust November 18, 1996
Antioch, Tennessee Bruce H. Gold & The Paul Gold Family Trust November 18, 1996
Nashville, Tennessee Bruce H. Gold, et al November 18, 1996
Nashville, Tennessee Shirley S. Gold, et al November 18, 1996
Franklin, Tennessee Bruce H. Gold & The Paul Gold Family Trust November 18, 1996
Sacramento, California Chartwell Mini-Storage, LP November 18, 1996
Baltimore, Maryland* Terminal Building Associates November 26, 1996
Harrison, New Jersey International American Company December 5, 1996
Orange, New Jersey Orange Mini-Storage, LP December 5, 1996
Secaucus, New Jersey Larosan Enterprises, LLC December 5, 1996
Flanders, New Jersey P.F. Rosenberg Assoc. LLC, et al December 5, 1996
Hackensack, New Jersey Larosan Enterprises, LLC December 5, 1996
Phoenix, Arizona Four S Properties December 17, 1996
Sacramento, California Space Shuttle I, LP December 31, 1996 #
</TABLE>
# The acquisition of this self-storage facility was not reported in the
Company's Form 8-K filed on December 19, 1996.
2
<PAGE> 3
The following unaudited data related to the facilities is derived from the
Company's internal records as of the last day of the month following closing,
or the most current information available:
<TABLE>
<CAPTION>
SQUARE RENT PER ECONOMIC PHYSICAL
LOCATION FEET SQUARE FOOT OCCUPANCY OCCUPANCY TOTAL UNITS CONTRACT PRICE
- -------- ------ ----------- --------- --------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
Troy, Michigan 59,180 $ 11.06 91% 97% 511 $ 4,677,000
Grand Rapids, Michigan 53,943 6.98 91% 95% 638 2,213,000
Grandville, Michigan 59,754 6.18 86% 90% 599 2,414,000
Mesa, Arizona 59,825 6.57 74% 90% 602 2,052,000
Sugarland, Texas 54,910 9.11 46% 54% 478 2,500,000
Nashville, Tennessee 48,225 6.98 84% 92% 466 1,525,000
Nashville, Tennessee 35,925 7.13 75% 83% 350 1,250,000
Mesa, Arizona 122,328 5.47 55% 71% 865 3,355,000
Birmingham, Alabama 36,250 7.45 70% 74% 272 1,283,000
Fredricksburg, Virginia 50,258 10.50 64% 71% 564 3,117,000
Fredricksburg, Virginia 47,475 10.30 66% 74% 471 2,468,000
Stafford, Virginia 51,286 10.60 67% 73% 469 2,773,000
Charlottesville, Virginia 46,425 10.66 55% 64% 484 2,763,000
Nashville, Tennessee 55,432 11.42 75% 82% 538 4,680,000
Antioch, Tennessee 65,300 8.93 71% 75% 567 3,092,000
Nashville, Tennessee 101,475 8.25 82% 81% 684 5,302,000
Nashville, Tennessee 101,875 7.85 64% 68% 699 4,496,000
Franklin, Tennessee 72,600 7.97 72% 72% 566 3,099,000
Sacramento, California 77,869 6.76 76% 89% 711 2,356,000
Baltimore, Maryland 82,174 9.84 81% 85% 846 5,650,000
Harrison, New Jersey 29,812 19.34 79% 82% 585 2,903,000
Orange, New Jersey 80,815 18.56 84% 85% 1,018 8,516,000
Secaucus, New Jersey 117,950 15.23 83% 92% 1,181 10,127,000
Flanders, New Jersey 25,840 14.44 71% 88% 216 2,207,000
Hackensack, New Jersey 123,735 17.75 79% 82% 1,482 13,073,000
Phoenix, Arizona 80,115 10.93 68% 70% 708 4,855,000
Sacramento, California 61,484 5.77 82% 82% 528 1,670,000
------------------------------------------------------------------------------------
1,802,260 $ 10.17 75% 80% 17,098 $ 104,416,000
------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 4
The following unaudited data related to the facilities is derived from the
Company's internal records as of the last day of the month following closing,
or the most current information available:
<TABLE>
<CAPTION>
SQUARE RENT PER ECONOMIC PHYSICAL
LOCATION FEET SQUARE FOOT OCCUPANCY OCCUPANCY TOTAL UNITS CONTRACT PRICE
- -------- ------ ----------- --------- --------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
Troy, Michigan 59,180 $ 11.06 91% 97% 511 $ 4,677,000
Grand Rapids, Michigan 53,943 6.98 91% 95% 638 2,213,000
Grandville, Michigan 59,754 6.18 86% 90% 599 2,414,000
Mesa, Arizona 59,825 6.57 74% 90% 602 2,052,000
Sugarland, Texas(1) 54,910 9.11 46% 54% 478 2,500,000
Nashville, Tennessee 48,225 6.98 84% 92% 466 1,525,000
Nashville, Tennessee 35,925 7.13 75% 83% 350 1,250,000
Mesa, Arizona 122,328 5.47 55% 71% 865 3,355,000
Birmingham, Alabama 36,250 7.45 70% 74% 272 1,283,000
Fredricksburg, Virginia 50,258 10.50 64% 71% 564 3,117,000
Fredricksburg, Virginia 47,475 10.30 66% 74% 471 2,468,000
Stafford, Virginia 51,286 10.60 67% 73% 469 2,773,000
Charlottesville, Virginia 46,425 10.66 55% 64% 484 2,763,000
Nashville, Tennessee 55,432 11.42 75% 82% 538 4,680,000
Antioch, Tennessee 65,300 8.93 71% 75% 567 3,092,000
Nashville, Tennessee 101,475 8.25 82% 81% 684 5,302,000
Nashville, Tennessee 101,875 7.85 64% 68% 699 4,496,000
Franklin, Tennessee 72,600 7.97 72% 72% 566 3,099,000
Sacramento, California 77,869 6.76 76% 89% 711 2,356,000
Baltimore, Maryland 82,174 9.84 81% 85% 846 5,650,000
Harrison, New Jersey 29,812 19.34 79% 82% 585 2,903,000
Orange, New Jersey 80,815 18.56 84% 85% 1,018 8,516,000
Secaucus, New Jersey 117,950 15.23 83% 92% 1,181 10,127,000
Flanders, New Jersey 25,840 14.44 71% 88% 216 2,207,000
Hackensack, New Jersey 123,735 17.75 79% 82% 1,482 13,073,000
Phoenix, Arizona(2) 80,115 10.93 68% 70% 708 4,855,000
Sacramento, California 61,484 5.77 82% 82% 528 1,670,000
------------------------------------------------------------------------------------
1,802,260 $ 10.17 75% 80% 17,098 $ 104,416,000
------------------------------------------------------------------------------------
</TABLE>
(1) The facility purchased in Sugarland, Texas opened in March 1995. Its
revenues in excess of direct operating expenses for the period March 1995
to December 31, 1995, as reflected in the Historical Summaries of
Combined Gross Revenue and Direct Operating Expenses were a loss of
$12,368.
(2) The facility purchased in Phoenix, Arizona opened in November 1995. Its
revenues in excess of direct operating expenses for the period November
1995 to December 1995, as reflected in the Historical Summaries of
Combined Gross Revenue and Direct Operating Expenses were a loss of
$13,295.
3
<PAGE> 5
ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS
(a) FINANCIAL STATEMENTS APPLICABLE TO REAL ESTATE PROPERTIES ACQUIRED.
* Report of Independent Accountants.
* Acquisition Facilities Historical Summaries of Combined Gross Revenue
and Direct Operating Expenses for the year ended December 31, 1995
(Audited), and for the nine months ended September 30, 1996
(Unaudited).
* Notes to Historical Summaries of Combined Gross Revenue and Direct
Operating Expenses.
(b) PRO FORMA FINANCIAL INFORMATION
* Unaudited Pro Forma Combined Condensed Balance Sheet as of September
30, 1996.
* Unaudited Pro Forma Combined Condensed Statement of Operations for
the nine months ended September 30, 1996.
* Unaudited Pro Forma Combined Condensed Statement of Operations for
the year ended December 31, 1995.
* Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
(c) EXHIBITS
Exhibit Description
23.0 Consent of Independent Accountants.
4
<PAGE> 6
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
and Shareholders of
Storage USA, Inc.
We have audited the accompanying Historical Summaries of Combined
Gross Revenue and Direct Operating Expenses (the "Historical Summaries") for
certain self-storage facilities (the "Acquisition Facilities") described in
Note 1 to the Historical Summaries for the year ended December 31, 1995. These
Historical Summaries are the responsibility of the management of the
Acquisition Facilities. Our responsibility is to express an opinion on these
Historical Summaries based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the Historical Summaries are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the Historical Summaries.
An audit also includes assessing the accounting principles used and the
significant estimates made by management, as well as evaluating the overall
presentation of the Historical Summaries. We believe that our audits provide a
reasonable basis for our opinion.
The accompanying Historical Summaries were prepared for the purposes
of complying with the Rules and Regulations of the Securities and Exchange
Commission (for inclusion in the Form 8-K/A of Storage USA, Inc.) as described
in Note 1 to the Historical Summaries, and are not intended to be a complete
presentation of the Acquisition Facilities' revenues and expenses.
In our opinion, based on our audits, the Historical Summaries
referred to above present fairly, in all material respects, the combined gross
revenue and direct operating expenses described in Note 1 of the Acquisition
Facilities for the year ended December 31, 1995, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
February 13, 1997
5
<PAGE> 7
ACQUISITION FACILITIES
HISTORICAL SUMMARIES OF COMBINED GROSS
REVENUE AND DIRECT OPERATING EXPENSES
(amounts in thousands)
<TABLE>
<CAPTION>
For the For the
year ended nine months ended
December 31, September 30,
1995 1996
------------ -----------------
(unaudited)
(note 1)
<S> <C> <C>
Gross Revenue:
Rental revenue $12,988 $10,698
Other revenue 72 53
------------ -----------------
Total gross revenue 13,060 10,751
------------ -----------------
Direct Operating Expenses:
Property operations and maintenance 2,456 2,108
Real estate taxes 941 735
------------ -----------------
Total direct operating expenses 3,397 2,843
------------ -----------------
Revenue in excess of direct operating expenses $ 9,663 $ 7,908
============ =================
</TABLE>
See accompanying notes.
6
<PAGE> 8
1. BASIS OF PRESENTATION
The Historical Summaries of Combined Gross Revenue and Direct
Operating Expenses (the "Historical Summaries") relate to the operation of the
following 27 self-storage facilities (the "Acquisition Facilities") which have
been acquired by the OP during the period from October 16, 1996 to
December 31, 1996.
Acquisition Facilities - Locations
<TABLE>
<S> <C> <C>
Troy, Michigan Fredricksburg, Virginia Sacramento, California
Grand Rapids, Michigan Fredricksburg, Virginia Baltimore, Maryland *
Grandville, Michigan Stafford, Virginia Harrison, New Jersey
Mesa, Arizona Charlottesville, Virginia Orange, New Jersey
Sugarland, Texas Nashville, Tennessee Secaucus, New Jersey
Nashville, Tennessee Antioch, Tennessee Flanders, New Jersey
Nashville, Tennessee Nashville, Tennessee Hackensack, New Jersey
Mesa, Arizona Nashville, Tennessee Phoenix, Arizona
Birmingham, Alabama Franklin, Tennessee Sacramento, California
</TABLE>
* - The Company managed this facility prior to the purchase.
The Historical Summaries have been prepared pursuant to the Rules and
Regulations of the Securities and Exchange Commission for real estate
operations to be acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain expenses which may
not be comparable to the expenses expected to be incurred by the Company in the
future operations of the Acquisition Facilities have been excluded. Expenses
excluded consist of management fees, interest, depreciation and amortization,
professional fees and other indirect costs not directly related to the future
operations of the Acquisition Facilities. Rental Income is recognized when due
from occupants. Expenses are recognized on the accrual basis.
2. INTERIM PERIODS
The unaudited interim Historical Summaries have been prepared in
accordance with generally accepted accounting principles for interim financial
information. In the opinion of management, all adjustments considered
necessary for a fair presentation are of a normal recurring nature and have
been included. Operating results for the nine months ended September 30, 1996
are not necessarily indicative of future operating results.
7
<PAGE> 9
STORAGE USA, INC.
PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION
The following unaudited Pro Forma Combined Condensed Balance Sheet as
of September 30, 1996, and the unaudited Pro Forma Combined Condensed
Statements of Operations for the nine months ended September 30, 1996, and for
the year ended December 31, 1995 have been prepared to reflect the acquisition
of the 27 Acquisition Facilities as if the Acquisition Facilities and other
previously reported transactions had been consummated at the beginning of the
respective periods shown. The Pro Forma Combined Condensed Financial
Information is based on the historical financial statements included in the
Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
1996 and the pro forma financial information set forth in the footnotes to the
financial statements included in the Company's Annual Report on Form 10-K for
the year ended December 31, 1995, and should be read in conjunction with those
financial statements and the notes thereto. The Pro Forma Combined Condensed
Balance Sheet was prepared as if the 27 Acquisition Facilities were purchased
on September 30, 1996. The Pro Forma Combined Condensed Statements of
Operations were prepared as if the Acquisition Facilities were purchased at the
beginning of the respective periods reflected thereon. The Combined Condensed
Pro Forma Financial Information is not necessarily indicative of the financial
position or results of operations which actually would have occurred if such
transactions had been consummated on the dates described, nor does it purport
to represent the Company's future financial position or results of operations.
8
<PAGE> 10
STORAGE USA, INC.
PRO FORMA COMBINED CONDENSED BALANCE SHEET
as of September 30, 1996
(Unaudited)
(amounts in thousands)
<TABLE>
<CAPTION>
Historical Pro Forma
Storage Acquisition Pro Forma Storage
USA, Inc. Facilities Adjustments USA, Inc.
------------ -------------- ------------- ------------
<S> <C> <C> <C> <C>
Assets:
Investment in storage facilities, net $707,540 $105,226 $812,766
Cash and equivalents 3,169 3,169
Other assets 8,942 8,942
------------ -------------- ------------- ------------
Total assets $719,651 $105,226 $0 $824,877
============ ============== ============= ============
Liabilities and Shareholders' Equity
Line of credit borrowings 66,138 57,315 (100,000) (a) 23,453
Mortgage notes payable 17,972 25,790 43,762
Notes payable 100,000 (a) 100,000
Accounts payable and accrued expenses 7,401 7,401
Rents received in advance 4,651 4,651
Dividend payable 11,987 11,987
Minority interest 36,485 22,121 58,606
------------ -------------- ------------- ------------
Total liabilities $144,634 $105,226 $0 $249,860
------------ -------------- ------------- ------------
Shareholders' Equity
Common stock 246 246
Paid-in capital 607,030 607,030
Notes receivable - officers (8,066) (8,066)
Accumulated deficit (15,831) (15,831)
Distributions in excess of net income (8,362) (8,362)
------------ -------------- ------------- ------------
Total shareholders' equity 575,017 - - 575,017
------------ -------------- ------------- ------------
Total liabilities and
shareholders' equity $719,651 $105,226 $0 $824,877
============ ============== ============= ============
</TABLE>
See accompanying notes.
9
<PAGE> 11
STORAGE USA, INC.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
For the nine months ended September 30, 1996
(Unaudited)
(thousands, except per share data)
<TABLE>
<CAPTION>
Historical Pro Forma
Storage Acquisition Pro Forma Storage
USA, Inc. Facilities Adjustments USA, Inc.
-------------- ---------------- ------------- -------------
<S> <C> <C> <C> <C>
Property Revenues:
Rental income $73,396 $10,698 $12,854 (b) $96,948
Management income 560 (216) (c) 344
Other income 1,170 53 136 (d) 1,359
-------------- ---------------- ------------- -------------
Total revenues 75,126 10,751 12,774 98,651
-------------- ---------------- ------------- -------------
Property Expenses:
Cost of property operations
and maintenance 19,933 2,108 2,962 (e) 25,003
Taxes 6,163 735 1,052 (f) 7,950
General & administrative 3,067 600 (g) 3,667
Depreciation & amortization 8,813 3,100 (h) 11,913
-------------- ---------------- ------------- -------------
Total expenses 37,976 2,843 7,714 48,533
-------------- ---------------- ------------- -------------
Income from property operations 37,150 7,908 5,060 50,118
Other Income (expenses):
Interest expense (5,848) (3,580) (i) (9,428)
Interest income 506 506
-------------- ---------------- ------------- -------------
Income before minority interest 31,808 7,908 1,480 41,196
Gain on investment 288 288
-------------- ---------------- ------------- -------------
Income before minority interest 32,096 7,908 1,480 41,484
Minority interest (1,915) (1,040)(j) (2,955)
-------------- ---------------- ------------- -------------
Net income $30,181 $7,908 $440 $38,529
============== ================ ============= =============
Net income per share $1.54 $1.56
============== =============
Weighted average shares outstanding 19,588 24,723
-------------- -------------
</TABLE>
See accompanying notes.
10
<PAGE> 12
STORAGE USA, INC.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
For the year ended December 31, 1995
(Unaudited)
(thousands, except per share data)
<TABLE>
<CAPTION>
Initial
Pro Forma Pro Forma
Storage Acquisition Pro Forma Storage
USA, Inc. Facilities Adjustments USA, Inc.
---------- ----------- ------------ ---------
<S> <C> <C> <C> <C>
Property Revenues:
Rental income $ 81,875 $12,988 $ 27,658 (k) $122,521
Management income 1,072 (555) (l) 517
Other income 1,037 72 370 (m) 1,479
--------- --------- ------------ ---------
Total revenues 83,984 13,060 27,473 $124,517
--------- --------- ------------ ---------
Property Expenses:
Cost of property operations
and maintenance 22,385 2,456 5,914 (n) 30,755
Taxes 6,171 941 3,002 (o) 10,114
General & administrative 3,046 1,300 (p) 4,346
Depreciation & amortization 9,579 5,621 (q) 15,200
--------- --------- ------------ ---------
Total expenses 41,181 3,397 15,837 60,415
--------- --------- ------------ ---------
Income from property operations 42,803 9,663 11,636 64,102
Other Income (expenses):
Interest expense (7,679) (5,984) (r) (13,663)
Interest income 637 637
--------- --------- ------------ ---------
Income before minority interest 35,761 9,663 5,652 51,076
Minority interest (1,798) (1,854) (s) (3,652)
--------- --------- ------------ ---------
Net income $33,963 $ 9,663 $ 3,798 $47,424
========= ========= ============ =========
Net income per share $1.93 $1.92
========= =========
Weighted average shares outstanding 17,562 24,723
--------- ---------
</TABLE>
See accompanying notes.
11
<PAGE> 13
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT SHARE/UNIT AND PER SHARE/UNIT DATA)
(UNAUDITED)
1. STORAGE USA, INC.
The historical financial information of Storage USA, Inc. (the
"Company") includes SUSA Partnership, LP (the "Operating Partnership"), Storage
USA, Trust (the "Trust") and SUSA Management, Inc. ("SUSA Management").
2. ACQUISITION FACILITIES - BALANCE SHEET
Amounts reflect the acquisition of 27 facilities acquired from
October 16, 1996 to December 31, 1996, for a price of $105,226. The total
acquisition price includes the purchase price of the facilities ($104,416) plus
the Company's estimated average cost of $30 per property for capital
improvements ($810). The total acquisition price was funded with borrowings
under the Company's lines of credit, the assumption of $25,790 of mortgages
payable, the issuance by the Operating Partnership of $100,000 of 7.125% Notes
payable due November 1, 2003, and the issuance of 615,000 units of limited
partnership interest in the Operating Partnership ("OP Units"). The OP Units
were issued at various amounts per Unit, ranging from $34.41 to $36.60 per
unit.
3. STORAGE USA, INC. - INITIAL PRO FORMA STATEMENT OF OPERATIONS
The Initial Pro Forma Statement of Operations for the year ended
December 31, 1995 is presented as if the Company's public offering of 4,025,000
shares of common stock at $28.375 per share and the acquisition of 63
properties during 1995 had occurred on January 1, 1995.
4. ACQUISITION FACILITIES - STATEMENT OF OPERATIONS
The statements of operations for the Acquisition Facilities reflects
the results of operations of the Acquisition Facilities for the year ended
December 31, 1995, and the results of operations of the Acquisition Facilities
for the nine months ended September 30, 1996, which are included in the
Acquisition Facilities Historical Summaries of Combined Gross Revenue and
Direct Operating Expenses.
12
<PAGE> 14
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - COMBINED CONDENSED BALANCE SHEET
Pro Forma Adjustments are as follows:
<TABLE>
<CAPTION>
AS OF
SEPTEMBER 30, 1996
------------------
<S> <C> <C>
(a) To reflect the issuance of 7.125% Notes payable due November 1,
2003, and the use of proceeds to repay the line of credit. $ 100,000
PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS
NINE MONTHS ENDED
SEPTEMBER 30, 1996
------------------
(b) To record rental income for 29 properties acquired during the
first six months of 1996 from January 1, 1996 to the date acquired. $ 5,268
To reduce rental income for the 80% of the West Palm Beach
Acquisition Facility, which was consolidated in the Historical balances. $ (240)
To reduce rental income for the Jacksonville property exchanged
for the two Oklahoma facilities, which was consolidated in the
Historical balances. $ (359)
To record rental income for 18 properties acquired from June 28, 1996
to July 31, 1996, from January 1, 1996 to the date acquired. $ 4,898
To record rental income for 9 properties acquired from August 1, 1996
to September 30, 1996, from January 1, 1996 to the date acquired. $ 3,287
------
Pro Forma adjustment $ 12,854
(c) To reduce management income for the 14 managed properties
acquired in the first six months of 1996, the one managed property
acquired on August 30, 1996, and the one managed property acquired
on November 26, 1996, based on actual management fees
earned by the Company. $ (216)
</TABLE>
13
<PAGE> 15
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, 1996
------------------
<S> <C>
(d) To record other income for 29 properties acquired during the
first six months of 1996 from January 1, 1996 to the date acquired. $ 58
To reduce other income for the 80% of the West Palm Beach
Acquisition Facility, which was consolidated in the Historical balances. $ (7)
To record other income for 18 properties acquired from June 28, 1996
to July 31, 1996, from January 1, 1996 to the date acquired. $ 67
To record other income for 9 properties acquired from August 1, 1996
to September 30, 1996, from January 1, 1996 to the date acquired. $ 18
---
Pro Forma adjustment $ 136
(e) To record the cost of property operations for 29 properties acquired
during the first six months of 1996 from January 1, 1996 to the date
acquired. $ 1,367
To reduce the cost of property operations for 80 % of the West Palm
Beach Acquisition Facility, which cost was consolidated in the
Historical balances. $ (82)
To reduce the cost of property operations and maintenance for the
Jacksonville property exchange for the two Oklahoma facilities,
which cost was consolidated in the Historical balances. $ (85)
To record the cost of property operations for the 18 properties acquired
from June 28, 1996 to July 31, 1996, from January 1, 1996 to the date
acquired. $ 1,032
To record the cost of property operations for the 9 properties acquired
from August 1, 1996 to September 30, 1996, from January 1, 1996 to
the date acquired. $ 730
-----
Pro Forma adjustment $ 2,962
</TABLE>
14
<PAGE> 16
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, 1996
------------------
<S> <C> <C>
(f) To record taxes for 29 properties acquired during the first
six months of 1996 from January 1, 1996 to the date acquired. $ 399
To reduce taxes for 80% of the West Palm Beach Acquisition
Facility, which was consolidated in the Historical balances. $ (18)
To record taxes for the 18 properties acquired from June 28,
1996 to July 31, 1996, from January 1, 1996 to the date acquired. $ 297
To reduce taxes for the Jacksonville property exchanged for the two
Oklahoma facilities, which were consolidated in the Historical balances $ (49)
To record taxes for the 9 properties acquired from August 1, 1996
to September 30, 1996, from January 1, 1996 to the date acquired. $ 223
To reflect an estimated increase in taxes based on results subsequent
to acquisition. $ 200
-----
Pro Forma adjustment $ 1,052
(g) To reflect an estimated increase in general and administrative expense
based on results subsequent to acquisition. $ 600
(h) To record depreciation for 29 properties acquired during the first
six months of 1996 from January 1, 1996 to the date acquired, based
on approximately $60,099 of the purchase price being allocated to
depreciable assets, based on a 40 year life. $ 668
To record depreciation from January 1, 1996 to the date acquired for
the 18 facilities acquired from June 28, 1996 to July 31, 1996 based
on approximately $47,160 of the purchase price being allocated to
depreciable assets and based on a 40 year life. $ 617
To record depreciation from January 1, 1996 to the date acquired
for the 9 facilities acquired from August 1, 1996 to September 30, 1996,
based on approximately $24,628 of the purchase price being allocated to
depreciable assets and based on a 40 year life. $ 376
To record depreciation on Acquisition Facilities based on approximately
$76,742 of the purchase price being allocated to depreciable assets and
based on a 40 year life. $ 1,439
-----
Pro Forma adjustment $ 3,100
</TABLE>
15
<PAGE> 17
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, 1996
------------------
<S> <C> <C>
(i) To record interest expense for 29 properties acquired during the first
six months of 1996 from January 1, 1996 to the date acquired, based
on bank borrowings at 6.4% and mortgages assumed. $ (2,393)
To reflect interest expense from January 1, 1996 to date acquired on
$62,391 of bank debt utilized to fund the purchase of the 18 properties
acquired from June 28, 1996 to July 31, 1996, based on
bank borrowings at 6.4%. $ (2,090)
To reflect interest expense from January 1, 1996 to date acquired on
$29,296 of bank debt utilized to fund the purchase of the 9 facilities
acquired from August 16, 1996 to September 30, 1996, based on
bank borrowings at 6.4% and $4,440 of mortgages
assumed at 7.0%. $ (1,508)
To reflect interest expense on bank debt utilized to fund the purchase
of the Acquisition Facilities, based on $57,315 of bank borrowings at
6.4%. $ (2,746)
To reflect the pro forma effect of additional interest expense due to
the issuance of $100,000 of 7.125% Notes payable used to reduce
lines of credit borrowings, assumed to occur on January 1, 1996. $ (544)
To reflect interest expense on mortgage notes payable assumed
to fund the purchase of the Acquisition Facilities, based on $25,790
of mortgages with a weighted average interest rate of 11.1%,
assumed to occur on January 1, 1996. $ (2,149)
Less: Interest savings as a result of the pro forma effect of
the first quarter equity offering of $61,000, the third quarter equity
offering of $60,000, and the third quarter equity offering of $99,000,
all assumed to occur on January 1, 1996. $ 7,750
Less: Interest savings as a result of the pro forma effect of reduced
lines of credit borrowings due to the non-cash purchase of two
Oklahoma facilities. $ 100
------
Pro Forma adjustment $ (3,580)
</TABLE>
16
<PAGE> 18
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, 1996
------------------
<S> <C> <C>
(j) To reduce minority interest expense for the nine months ended
September 30, 1996 on West Palm Beach Acquisition Facility which the
company had an approximately 20% interest in prior to acquisition. $ 109
To reflect minority interest expense on the 29 facilities acquired
during the first six months of 1996, the 18 facilities acquired from
June 28, 1996 to July 31, 1996, the 9 facilities acquired from
August 16, 1996 to September 30, 1996, the Acquisition Facilities,
and the pro forma adjustments. $ (1,149)
------
Pro Forma adjustment $ (1,040)
<CAPTION>
PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS
YEAR ENDED
DECEMBER 31, 1995
-----------------
<S> <C> <C>
(k) To record rental income for 29 properties acquired during the
first six months of 1996. $ 14,954
To reduce rental income for the 80% of the West Palm Beach
Acquisition Facility as the property was consolidated in the Initial
Pro Forma balances. $ (489)
To reduce rental income for the Jacksonville property exchanged
for the two Oklahoma facilities, which was consolidated in the
Initial Pro Forma balances. $ (79)
To record rental income for 18 properties acquired from June 28, 1996
to July 31, 1996. $ 8,906
To record rental income for 9 properties acquired from August 16, 1996
to September 30, 1996. $ 4,366
------
Pro Forma adjustment $ 27,658
(l) To reflect the reduction in management income for the fourteen
managed properties acquired in the first six months of 1996, for
the one managed property acquired on August 30, 1996, and for the
one managed property acquired on November 26, 1996, for the
period managed by the Company, based on actual management fees
earned by the Company for the year ended December 31, 1995. $ (555)
</TABLE>
17
<PAGE> 19
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1995
-----------------
<S> <C> <C>
(m) To record other income for 29 properties acquired during the
first six months of 1996. $ 264
To reduce other income for the 80% of the West Palm Beach
Acquisition Facility as the property was consolidated in the Initial
Pro Forma balances. $ (2)
To record other income for 18 properties acquired from June 28, 1996
to July 31, 1996. $ 76
To record other income for 9 properties acquired from August 16, 1996
to September 30, 1996. $ 32
-----
Pro Forma adjustment $ 370
(n) To record cost of property operations for 29 properties acquired
during the first six months of 1996. $ 3,288
To reduce the cost of property operations and maintenance for
the 80% of the West Palm Beach Acquisition Facility as the property
was consolidated in the Initial Pro Forma balances. $ (141)
To reduce the cost of operations for the Jacksonville property
exchanged for the two Oklahoma facilities, which was consolidated
in the Initial Pro Forma balances. $ (14)
To record cost of property operations for 18 properties acquired
from June 28, 1996 to July 31, 1996. $ 1,870
To record cost of property operations for 9 properties acquired
from August 16, 1996 to September 30, 1996. $ 911
-----
Pro Forma adjustment $ 5,914
</TABLE>
18
<PAGE> 20
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1995
-----------------
<S> <C> <C>
(o) To record taxes for 29 properties acquired during the first six
months of 1996. $ 1,148
To reflect the estimated increase in taxes based on the
Company's historical results subsequent to acquisition. $ 1,000
To reduce taxes for the 80% of the West Palm Beach
Acquisition Facility as the property was consolidated in the
Initial Pro Forma balances. $ (21)
To reduce taxes for the Jacksonville property exchanged
for the two Oklahoma facilities, which was consolidated in the
Initial Pro Forma balances. $ (6)
To record taxes for 18 properties acquired from June 28, 1996
to July 31, 1996. $ 578
To record taxes for 9 properties acquired from August 16, 1996
to September 30, 1996. $ 303
-----
Pro Forma adjustment $ 3,002
(p) To reflect estimated increase in general and administrative expense
based on the Company's historical results subsequent to
acquisition. $ 1,300
(q) To record depreciation for 29 properties acquired during the first
six months of 1996, based on approximately $ 76,261 of the purchase
price being allocated to depreciable assets, based on a 40 year life. $ 1,907
To record depreciation for 18 facilities acquired from June 28, 1996
to July 31, 1996, based on approximately $ 47,160 of the purchase
price being allocated to depreciable assets and based on a 40 year life. $ 1,179
To record depreciation for 9 facilities acquired from August 16, 1996
to September 30, 1996, based on approximately $24,628 of the purchase
price being allocated to depreciable assets and based on a 40 year life. $ 616
To record depreciation for the Acquisition Facilities, based on
approximately $76,815 of the purchase price being allocated to
depreciable assets and based on a 40 year life. $ 1,919
-----
Pro Forma adjustment $ 5,621
</TABLE>
19
<PAGE> 21
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1995
-----------------
<S> <C> <C>
(r) To record interest expense for 29 properties acquired during the first
six months of 1996, based on $93,164 of bank borrowings at 6.1%. $ (5,683)
To reflect interest expense on mortgages assumed of $ 7,060 at 9.0%. $ (636)
To reflect interest expense on bank debt utilized to fund the
purchase of the 18 properties acquired from June 28, 1996 to July 31,
1996, based on $62,391 of bank borrowings at 6.1%. $ (3,806)
To reflect interest expense on bank debt utilized to fund the purchase
of the 9 facilities acquired from August 16, 1996 to September 30,
1996, based on $29,296 of bank borrowings at 6.1% and $4,440
of mortgages assumed at 7.0%. $ (2,098)
To reflect interest expense on bank debt utilized to fund the purchase
of the Acquisition Facilities, based on $57,315 of bank borrowings at
6.1%. $ (3,490)
To reflect the pro forma effect of additional interest expense due to
the issuance of $100,000 of 7.125% Notes payable used to reduce
lines of credit borrowings, assumed to occur on January 1, 1995. $ (1,025)
To reflect interest expense on mortgage notes payable assumed
to fund the purchase of the Acquisition Facilities, based on $25,790
of mortgages with a weighted average interest rate of 11.1%,
assumed to occur on January 1, 1995. $ (2,866)
Less: Interest savings as a result of the pro forma effect of
the first quarter equity offering of $61,000, the third quarter equity
offering of $60,000, and the third quarter equity offering of $99,000,
all assumed to occur on January 1, 1995. $ 13,420
Less: Interest savings as a result of the pro forma effect of reduced
lines of credit borrowings due to the non-cash purchase of two
Oklahoma facilities. $ 200
------
Pro Forma adjustment $ (5,984)
</TABLE>
20
<PAGE> 22
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
5. PRO FORMA ADJUSTMENTS - STATEMENT OF OPERATIONS-CONTINUED
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1995
-----------------
<S> <C> <C>
(s) To reduce minority interest expense for the year ended
December 31, 1995 on West Palm Beach Acquisition Facility which the
company had an approximately 20% interest in prior to acquisition. $ 172
To reflect minority interest expense on the 29 facilities acquired
during the first six months of 1996, the 18 facilities acquired from
June 28, 1996 to July 31, 1996, the 9 facilities acquired from
August 16, 1996 to September 30, 1996, the Acquisition Facilities,
and the pro forma adjustments. $ (2,026)
------
Pro Forma adjustment $ (1,854)
</TABLE>
21
<PAGE> 23
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 thereunto duly authorized.
DATED: February 18, 1997
STORAGE USA, INC.
By:
-------------------
Thomas E. Robinson
President and
Chief Financial Officer
22
<PAGE> 1
EXHIBIT 23
[COOPERS & LYBRAND LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference into: (A) the Registration
Statements on Forms S-8 (Commission File Nos. 33-80967, 33-93884, 33-93882 and
33-86362) of Storage USA, Inc.; (B) the Registration Statements on Forms S-3
(Commission File Nos. 333-10903, 333-4556, 33-80965, 33-98142, 33-93886 and
33-91302) of Storage USA, Inc.; and (C) the Registration Statement on Form S-3,
(Commission File No. 333-3344) of SUSA Partnership, L.P. of our report dated
February 13, 1997, on our audit of the Historical Summaries of Combined Gross
Revenues and Direct Operating Expenses for certain self-storage facilities for
the year ended December 31, 1995, which report is included in this Form 8-K/A.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
February 13, 1997
