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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
___________________
June 2, 1995
(Date of Report; Date of Earliest Event Reported)
PRUDENTIAL REALTY TRUST
(Exact Name of Registrant as specified in its Charter)
Massachusetts 1-8965 22-6400284
(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
Prudential Plaza, Newark, New Jersey 07102
(Address of Principal Executive Offices) (Zip Code)
(201) 802-4302
(Registrant's telephone no., including area code)
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Items 1-4. Not Applicable.
Item 5. Other Events.
In continuation of the process that the Trust began in
December, 1994 of evaluating all strategic options available to maximize
the value of the Trust to its shareholders as the Trust approaches its
scheduled liquidation date, the Trust entered into a Purchase and Sale
Agreement (the "Agreement"), dated June 7, 1995, with Security Capital
Industrial Trust, a Maryland real estate investment trust ("Buyer"), for
the sale of the Trust's Park 100 property located in Indianapolis, Indiana
("Park 100"). The purchase price for Park 100 is $39.2 million, which is
payable in cash (the "Purchase Price").
The closing of the sale of Park 100 (the "Closing") is to occur
no later than ten (10) days after the expiration of a 45-day due diligence
period (such period to commence on the date of the Agreement), subject to
extensions as provided therein. Closing is contingent upon the
satisfactory completion of the due diligence review by Buyer and other
customary conditions for transactions of this nature.
Buyer deposited $1,000,000 in cash as earnest money ("Earnest
Money") with an escrow agent on June 8, 1995. At and upon the Closing, the
escrow agent will pay the Earnest Money, including interest thereon, if
any, to Seller or to the party entitled to receive the Earnest Money in
accordance with the terms of the Agreement.
If all of the conditions to Buyer's obligations to purchase
Park 100 have been satisfied or waived by Buyer and if Buyer fails to
consummate the transaction for any reason other than the Trust's default or
the exercise by Buyer of an express right of termination as provided for in
the Agreement, the Trust's sole remedy is to terminate the Agreement and to
retain the Earnest Money as liquidated damages. If the Trust does not
consummate the sale of Park 100 for any reason other than the default of
Buyer or the exercise by Buyer of a right of termination as provided for in
the Agreement, the Earnest Money will be refunded to Buyer. If Buyer
terminates the Agreement due to certain circumstances set forth in the
Agreement, the Trust shall reimburse Buyer for all out-of-pocket costs and
expenses, including reasonable attorney's fees, incurred by Buyer up to a
maximum reimbursement amount of $150,000 in connection with the preparation,
negotiation and execution of the Agreement and Buyer's due diligence review of
Park 100.
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Buyer will retain $1,000,000 of the Purchase Price at the
Closing until the period for which any and all claims which could be
subject to indemnification by the Trust has terminated (the "Holdback").
Pursuant to the terms of the Agreement, the Trust will indemnify Buyer for
all Losses (as defined in the Agreement) incurred by Buyer as a result of
any litigation pending or threatened before any court wherein an
adverse judgment would (a) prevent consummation of any of the transactions
contemplated in the Agreement, (b) cause any of such transactions to be
rescinded following consummation or (c) adversely affect the right of Buyer
to own and operate Park 100 or to achieve the benefits of the transaction.
Such indemnity is not limited to the amount of the Holdback or to any other
amount.
In addition, on June 2, 1995, in furtherance of the Board's
desire to comply with the long-standing policy and intent of the Trust and
in accordance with the Declaration, the Board adopted a series of
resolutions to effect the liquidation and termination of the Trust,
effective immediately prior to completion of the sale of Park 100 (the
"Resolutions"). The Resolutions, among other things, authorize certain
officers of the Trust to sell Park 100 and to sell or otherwise liquidate
the remaining Properties of the Trust upon such terms as may be approved by
a majority of the Unaffiliated Trustees (as defined in the Declaration),
and require that, after paying or adequately providing for the payment of
all liabilities of the Trust, the Trustees shall distribute the remaining
Trust Estate (as defined in the Declaration), in cash or in kind or partly
each, among the shareholders of the Trust according to their respective
rights under the Declaration.
The sale of Park 100, together with the potential sales of the
other two Trust properties at prices equal to the highest cash bids
received to date, could result in a distribution to holders of Income
Shares upon liquidation of approximately $5.00 per Income Share. There
would be no available distribution to holders of Capital Shares. This
assumes liquidation takes place in December 1995, and includes estimates
for commissions and state and local taxes related to the sales, and other
expenses related to the liquidation of the Trust.
Copies of the Agreement and the Resolutions are filed as
Exhibits 2.1 and 2.2 hereto, respectively, and are incorporated herein by
reference. The foregoing
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descriptions of the Agreement and the resolutions are qualified in their
entirety by reference to the text of such documents.
Item 6. Not Applicable.
Item 7. Financial Statements,
Pro Forma Financial Information and Exhibits.
(a)-(b) Not applicable.
(c) Exhibits Required by Item 601 of Regulation S-K.
Exhibit
No.
2.1 Purchase and Sale Agreement, dated June 7, 1995,
among Prudential Realty Trust and Security Capital
Industrial Trust.
2.2 Resolutions of the Board of Trustees of Prudential
Realty Trust, dated June 2, 1995, adopting a Plan of
Complete Liquidation.
Item 8. Not Applicable
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Dated: June 20, 1995
PRUDENTIAL REALTY TRUST
By: /s/ James W. McCarthy
Name: James W. McCarthy
Title: Vice President, Comptroller,
and Principal Accounting Officer
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EXHIBIT INDEX
Sequential
Exhibit No. Description Page No.
2.1 Purchase and Sale Agreement, dated June 7,
1995, among Prudential Realty Trust and
Security Capital Industrial Trust.
2.2 Resolutions of the Board of Trustees of
Prudential Realty Trust, dated June 2, 1995,
adopting a Plan of Complete Liquidation.