SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2002
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________ to __________
Commission file number 1-12560
JP REALTY, INC.
---------------
(Exact name of registrant as specified in its charter)
MARYLAND 87-0515088
-------- ----------
(State of incorporation) (I.R.S. Employer Identification No.)
35 CENTURY PARK-WAY
SALT LAKE CITY, UTAH 84115 (801) 486-3911
--------------------------- -------------
(Address of principal executive offices, including zip code) (Registrant's telephone number, including area code)
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 No
[X]
16,511,033 shares of Common Stock were outstanding as of May 8, 2002
JP REALTY, INC.
FORM 10-Q
INDEX
-----
PART I: FINANCIAL INFORMATION PAGE
- ------------------------------- ----
Item 1. Financial Statements 3
Consolidated Balance Sheet as of March 31, 2002
and December 31, 2001 4
Consolidated Statement of Operations for the Three Months
Ended March 31, 2002 and 2001 5
Condensed Consolidated Statement of Cash Flows
for the Three Months Ended March 31, 2002 and 2001 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 13
Item 3. Quantitative and Qualitative Disclosures About Market Risk 18
PART II: OTHER INFORMATION
- ----------------------------
Item 1. Legal Proceedings 19
Item 2. Changes in Securities and Use of Proceeds 19
Item 3. Defaults Upon Senior Securities 19
Item 4. Submission of Matters to a Vote of Security Holders 19
Item 5. Other Information 19
Item 6. Exhibits and Reports on Form 8-K 19
2
Certain matters discussed under the captions "Management's Discussion and
Analysis of Financial Condition and Results of Operations," "Quantitative and
Qualitative Disclosures About Market Risk" and elsewhere in this Quarterly
Report on Form 10-Q may constitute forward-looking statements for purposes of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and as such may involve known and
unknown risks, uncertainties and assumptions. Actual future performance,
achievements and results of JP Realty, Inc. (the "Company") may differ
materially from those expressed or implied by such forward-looking statements
as a result of such known and unknown risks, uncertainties, assumptions and
other factors. Representative examples of these factors include, without
limitation, general industry and economic conditions, interest rate trends,
cost of capital and capital requirements, availability of real estate
properties, competition from other companies and venues for the
sale/distribution of goods and services, shifts in customer demands, tenant
bankruptcies, governmental and public policy changes, the effects of the
proposed merger with General Growth Properties, Inc. and the continued
availability of financing in the amounts and on the terms necessary to support
the future business of the Company. Readers are cautioned that the Company's
actual results could differ materially from those set forth in such forward-
looking statements.
PART I
ITEM 1. FINANCIAL STATEMENTS
- ------------------------------
The information furnished in the accompanying financial statements listed
in the index on page 2 of this Quarterly Report on Form 10-Q reflects only
normal recurring adjustments which are, in the opinion of management, necessary
for a fair presentation of the aforementioned financial statements for the
interim periods.
The aforementioned financial statements should be read in conjunction with
the notes to the financial statements and Management's Discussion and Analysis
of Financial Condition and Results of Operations and the Company's Annual
Report on Form 10-K/A for the year ended December 31, 2001, including the
financial statements and notes thereto.
3
JP REALTY, INC.
CONSOLIDATED BALANCE SHEET
(DOLLARS IN THOUSANDS)
(UNAUDITED)
---------
MARCH 31, DECEMBER 31,
2002 2001
-------------- -------------
ASSETS
Real Estate Assets
Land $ 106,602 $ 106,602
Buildings 817,688 814,307
------------- --------------
924,290 920,909
Less: Accumulated Depreciation (182,633) (175,946)
------------- --------------
Operating Real Estate Assets 741,657 744,963
Real Estate Under Development 2,894 3,151
------------- --------------
Net Real Estate Assets 744,551 748,114
Cash 11,735 11,493
Restricted Cash 4,390 5,634
Accounts Receivable, Net 12,879 14,542
Deferred Charges, Net 8,178 8,418
Other Assets 7,696 7,571
------------- --------------
$ 789,429 $ 795,772
============= ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Borrowings $ 460,199 $ 478,682
Accounts Payable and Accrued Expenses 14,135 12,976
Dividends Payable 12,381 --
Other Liabilities 825 841
------------- --------------
487,540 492,499
------------- --------------
Minority Interest
Preferred Unitholders 112,327 112,327
Common Unitholders 26,406 27,308
Consolidated Partnerships 1,003 1,014
------------- --------------
139,736 140,649
------------- --------------
Commitments and Contingencies
STOCKHOLDERS' EQUITY
8.75% Series A Cumulative Redeemable Preferred Stock, $.0001 par
value, liquidation preference $25.00 per share, 510,000 shares
authorized, none issued or outstanding -- --
8.95% Series B Cumulative Redeemable Preferred Stock, $.0001
par value, liquidation preference $25.00 per share, 3,800,000
shares authorized, none issued or outstanding -- --
8.75% Series C Cumulative Redeemable Preferred Stock, $.0001
par value, liquidation preference $25.00 per share, 320,000
shares authorized, none issued or outstanding -- --
Series A Junior Participating Preferred Stock, $.0001 par
value, 3,060,000 shares authorized, none issued or outstanding -- --
Common Stock, $.0001 par value, 117,110,000 authorized,
16,311,000 shares and 16,148,000 shares issued and outstanding at
March 31, 2002 and December 31, 2001, respectively 2 2
Price Group Stock, $.0001 par value, 200,000 shares authorized,
issued and outstanding -- --
Excess Stock, 75,000,000 shares authorized, none issued or
outstanding -- --
Additional Paid-in Capital 214,451 210,820
Accumulated Dividends in Excess of Net Income (52,300) (48,198)
------------- --------------
162,153 162,624
------------- --------------
$ 789,429 $ 795,772
============= ==============
See accompanying notes to consolidated financial statements.
4
JP REALTY, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE THREE MONTHS ENDED MARCH 31,
------------------------------------
2002 2001
--------------- --------------
REVENUES
Minimum Rents $ 26,394 $ 25,623
Percentage and Overage Rents 583 713
Recoveries from Tenants 8,283 8,209
Interest 57 143
Other 376 332
--------------- --------------
35,693 35,020
--------------- --------------
EXPENSES
Operating and Maintenance 6,456 6,066
Real Estate Taxes and Insurance 3,944 3,735
Advertising and Promotions 166 178
General and Administrative 1,641 1,833
Merger Expenses 1,864 --
Depreciation 7,071 7,179
Amortization of Deferred Financing Costs 370 381
Amortization of Deferred Leasing Costs 135 171
Interest 6,156 8,038
--------------- --------------
27,803 27,581
--------------- --------------
7,890 7,439
Minority Interest in (Income) Loss of Consolidated Partnerships (59) 112
Gain on Sales of Real Estate -- 872
--------------- --------------
Income Before Minority Interest of the Operating Partnership
Unitholders 7,831 8,423
Minority Interest of the Operating Partnership Preferred
Unitholders (2,579) (2,579)
Minority Interest of the Operating Partnership Common Unitholders (954) (1,068)
--------------- --------------
Net Income $ 4,298 $ 4,776
=============== ==============
Basic Earnings Per Share $ 0.26 $ 0.29
=============== ==============
Diluted Earnings Per Share $ 0.26 $ 0.29
=============== ==============
Basic Weighted Average Number of Shares of Common Stock 16,371 16,219
Add: Dilutive Effect of Stock Options 92 13
--------------- --------------
Diluted Weighted Average Number of Shares of Common Stock 16,463 16,232
=============== ==============
See accompanying notes to consolidated financial statements.
5
JP REALTY, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
For the Three Months Ended March 31,
------------------------------------
2002 2001
--------------- --------------
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 17,848 $ 16,298
--------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES
Real Estate Assets, Developed or Acquired,
Net of Accounts Payable (3,369) (4,970)
Proceeds from the Sale of Real Estate -- 1,790
Decrease (Increase) in Restricted Cash 1,244 (4,109)
--------------- --------------
Net Cash Used in Investing Activities (2,125) (7,289)
--------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Borrowings 1,000 81,580
Repayment of Borrowings (19,483) (86,717)
Net Proceeds from Sale of Common Stock
From Stock Options Exercised 3,631 --
Distributions to Preferred Unitholders (454) (2,579)
Distributions to Minority Interests (70) (71)
Deferred Financing Costs (105) (377)
--------------- --------------
Net Cash Used in Financing Activities (15,481) (8,164)
--------------- --------------
Net Increase in Cash 242 845
Cash, Beginning of Period 11,493 2,636
--------------- --------------
Cash, End of Period $ 11,735 $ 3,481
=============== ==============
See accompanying notes to consolidated financial statements.
6
JP REALTY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
1. BUSINESS SUMMARY AND SIGNIFICANT ACCOUNTING POLICIES
The Company is primarily engaged in the business of owning, leasing,
managing, operating, developing and redeveloping regional malls, community
centers and other commercial properties. The tenant base includes primarily
national, regional and local retail companies. Consequently, the Company's
credit risk is concentrated in the retail industry. The Company is the sole
general partner of Price Development Company, Limited Partnership (the
"Operating Partnership"). The Company conducts all of its business operations
through, and holds a controlling general partner interest in, the Operating
Partnership.
The interim financial data for the three-months ended March 31, 2002 and
2001, is unaudited; however, in the opinion of the Company, the interim
financial data includes all adjustments, consisting only of normal recurring
adjustments, necessary for a fair presentation of the results for the interim
periods.
Deferred charges consist principally of financing fees and leasing
commissions paid to third parties. These costs are amortized on a straight-
line basis over the terms of the respective agreements and are recorded in the
consolidated statement of operations in amortization of deferred financing
costs and amortization of deferred leasing costs, which amounts, for deferred
financing fees, approximate those amortized using the effective interest
method.
2. BORROWINGS
MARCH 31,
2002
---------------
Credit facility, unsecured; variable rate; weighted average interest at 2.94%
during 2002, due in 2003 $ 106,000
Notes, unsecured; interest at 7.29%, maturing 2005 to 2008 100,000
Mortgage payable, secured by real estate; interest at 6.68%, due in 2008 81,317
Mortgage payable, secured by real estate; interest at 6.64%, due 2011 78,111
Loan facility, secured by real estate; variable rate; weighted average
interest at 3.37% during 2002, due in 2003 47,340
Construction loan, secured by real estate; variable rate; weighted average
interest at 3.36% during 2002, due in 2003 44,085
Other notes payable, secured by real estate; interest ranging from
7.0% to 9.99%, maturing 2003 to 2095 3,346
---------------
$ 460,199
===============
On January 22, 2001, the Operating Partnership through a consolidated
partnership Boise Mall, LLC, an indirectly wholly-owned subsidiary, obtained a
first mortgage on Boise Towne Square in the amount of $79,000 with a ten-year
term. The payment is based on a thirty-year amortization schedule with a
balloon payment of $68,315 on February 10, 2011, bearing interest at a fixed
6.64% per annum. The Operating Partnership used the proceeds to payoff $61,223
of notes, secured by real estate, with an interest rate of 6.37% which matured
on January 22, 2001 and reduced amounts outstanding under the Operating
Partnership's credit facility. The properties unencumbered by this transaction
include Cottonwood Mall in Holladay, Utah, North Plains Mall in Clovis, New
Mexico and Three Rivers Mall in Kelso, Washington.
7
JP REALTY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
2. BORROWINGS (CONTINUED)
On June 28, 2001, Provo Mall Development Company Ltd., a consolidated
partnership of which the Operating Partnership is the general partner,
exercised its right to extend its $50,000 construction loan facility. The
construction loan is collateralized by Provo Towne Centre and guaranteed by the
Operating Partnership. The loan bears interest at a variable rate indexed to
the LIBOR Rate plus 150 basis points. The LIBOR rate used is at the Company's
option and is based upon the 30, 60, or 90 day LIBOR rate. The balance
outstanding as of March 31, 2002 was $44,085. The extension was for a two-year
period maturing July 1, 2003.
On July 31, 2001, Spokane Mall Development Company, Ltd. Partnership, a
consolidated partnership of which the Operating Partnership is the general
partner, obtained a new loan facility from a group of banks led by Bank One
Arizona, NA. The new loan facility totals $47,340, of which $41,600 was drawn
at closing and used to pay-off and terminate the maturing $50,000 Spokane
Valley Mall construction loan, which had a balance of $41,600. The new loan
facility is for two years, maturing on July 31, 2003, with an interest rate of
LIBOR plus 150 basis points. The LIBOR rate used is at the Company's option
and is based upon the 30, 60, or 90 day LIBOR rate. An additional $5,740 was
drawn on the loan facility in December 2001 to fund the construction of Spokane
Valley Mall Plaza. The balance outstanding under this loan facility, as of
March 31, 2002 was $47,340.
3. SCHEDULE OF MATURITIES OF BORROWINGS
The following summarizes the scheduled maturities of borrowings at March
31, 2002:
YEAR TOTAL
- ---- -------------
2002 $ 1,425
2003 199,743
2004 2,124
2005 27,287
2006 27,446
2007 27,617
Thereafter 174,557
-------------
$ 460,199
=============
4. MINORITY INTEREST
PREFERRED COMMON CONSOLIDATED
UNITHOLDERS UNITHOLDERS PARTNERSHIPS TOTAL
------------ ----------- ------------ -------------
Minority Interest at December 31, 2001 $ 112,327 $ 27,308 $ 1,014 $ 140,649
Minority Interest Income 2,579 954 59 3,592
Distributions Paid (454) -- (70) (524)
Distributions Accrued (2,125) (1,856) -- (3,981)
------------ ----------- ------------ -------------
Minority Interest at March 31, 2002 $ 112,327 $ 26,406 $ 1,003 $ 139,736
============ =========== ============ =============
8
JP REALTY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
4. MINORITY INTEREST (CONTINUED)
In April 1999, the Operating Partnership issued 510,000 Series A 8.75%
cumulative redeemable preferred units of limited partner interests (the "Series
A Preferred Units") in exchange for a gross contribution of $12,750. Each
Series A Preferred Unit represents a limited partner interest with a
liquidation value of twenty-five dollars per unit. The Operating Partnership
used the proceeds, less applicable transaction costs of $405, for the repayment
of borrowings outstanding under the prior credit facility. The Series A
Preferred Units, which may be redeemed for cash at the option of the Operating
Partnership on or after April 23, 2004, have no stated maturity or mandatory
redemption and are not convertible into any other securities of the Operating
Partnership. The Series A Preferred Units are exchangeable at the option of
the preferred unitholder at a rate of one Series A Preferred Unit for one share
of the Company's Series A 8.75% cumulative redeemable preferred stock beginning
April 23, 2009, or earlier under certain circumstances. In the event that
shares of Series A preferred stock are issued in exchange for Series A
Preferred Units, the Operating Partnership will issue an equivalent number of
Series A Preferred Units To the Company. Any shares of Series A preferred stock
issued in exchange for Series A Preferred Units will have the same rights,
terms and conditions with respect to redemption as the Series A Preferred
Units and will not be convertible into any other securities of the Company.
The income allocated and distributions paid to the Series A Preferred Units
are based upon the rate of 8.75% on $12,750 or $279 for the three months ended
March 31, 2002 and 2001.
On July 28, 1999, the Operating Partnership issued 3,800,000 Series B
8.95% cumulative redeemable preferred units of limited partner interest (the
"Series B Preferred Units") in exchange for a gross contribution of $95,000.
Each Series B Preferred Unit represents a limited partner interest in the
Operating Partnership with a liquidation value of twenty-five dollars per unit.
The Operating Partnership used the proceeds, less applicable transaction costs
of $2,774, to repay $90,000 in borrowings under the prior credit facility and
increase operating cash. The Series B Preferred Units, which may be redeemed
for cash at the option of the Operating Partnership on or after July 28, 2004,
have no stated maturity or mandatory redemption and are not convertible into
any other securities of the Operating Partnership. The Series B Preferred
Units are exchangeable at the option of the preferred unitholder at a rate of
one Series B Preferred Unit for one share of the Company's Series B 8.95%
cumulative redeemable preferred stock beginning July 28, 2009, or earlier under
certain circumstances. In the event that shares of Series B preferred stock
are issued in exchange for Series B Preferred Units, the Operating Partnership
will issue an equivalent number of Series B Preferred Units to the Company.
Any shares of Series B preferred stock issued in exchange for Series B
Preferred Units will have the same rights, terms and conditions with respect to
redemption as the Series B Preferred Units and will not be convertible into any
other securities of the Company. The income allocated to holders of the Series
B Preferred Units is based upon the rate of 8.95% on $95,000 or $2,125 for the
three months ended March 31, 2002 and 2001. Distributions are paid on the last
day of the quarter providing that day is a business day. If the payment falls
on a non-business day, the payment is due on the following business day, except
that payment for the fourth quarter distributions must be made in December.
Since March 31, 2002 was a Sunday, the payment of $2,125 was made on April 1,
2002. Distributions paid were $0 and $2,125 for the three months ended March
31, 2002 and 2001.
On May 1, 2000, the Operating Partnership issued 320,000 Series C 8.75%
cumulative redeemable preferred units of limited partner interest (the "Series
C Preferred Units") in exchange for a gross contribution of $8,000. Each
Series C Preferred Unit represents a limited interest in the Operating
Partnership with a liquidation value of twenty-five dollars per unit. The
Operating Partnership used the proceeds, less applicable transaction costs and
expenses of $244 to pay down the borrowings under the prior credit facility.
The Series C Preferred Units, which may be redeemed for cash at the option of
the Operating Partnership on or after May 1, 2005, have no stated maturity or
mandatory redemption and are not convertible into any other securities of the
Operating Partnership. The Series C Preferred Units are exchangeable at the
option of the preferred unitholder at a rate of one Series C Preferred Unit for
one share of the Company's Series C 8.75% cumulative redeemable preferred stock
beginning May 1, 2010, or earlier under certain circumstances. In the event
that shares of Series C preferred stock are issued in exchange for Series C
Preferred Units, the Operating Partnership will issue an equivalent number of
Series C Preferred Units to the Company. Any shares of Series C preferred
stock issued in exchange for Series C Preferred Units will have the same
rights, terms and conditions with respect to redemption as the Series C
Preferred Units and will not be convertible into any other securities of the
Company. The income allocated and distribution paid to the Series C Preferred
Units are based upon the rate of 8.75% on $8,000 or $175 for the three months
ended March 31, 2002 and 2001.
9
JP REALTY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
4. MINORITY INTEREST (CONTINUED)
Net income of the Operating Partnership is allocated first to its
preferred unitholders as described above and then to its common unitholders
based upon their pro-rata share of unit ownership. The Operating Partnership's
income allocated to its common unitholders was based on the weighted average
number of common units outstanding as follows:
MARCH 31,
---------------------------------------------------------
2002 2001
-------------------------- ---------------------------
UNITS PERCENTAGE UNITS PERCENTAGE
------------ ----------- ------------ ------------
Units held by General Partner 16,371,000 81.81% 16,219,000 81.68%
Units held by Limited Partners 3,639,000 18.19% 3,637,000 18.32%
------------ ----------- ------------ ------------
20,010,000 100.00% 19,856,000 100.00%
============ =========== ============ ============
The consolidated partnerships' minority interests in income or loss are
calculated by multiplying the percentage of each such partnership owned by its
respective minority partners by the total income or loss of such partnership,
unless the cumulative losses exceed the limited partners' investment. Such
excess losses previously attributable to the limited partners will be
recognized by the Company. Future income attributable to the limited partners
will be recognized by the Company to the extent of these losses.
5. STOCKHOLDERS' EQUITY
The following table summarizes changes in stockholders' equity since
December 31, 2001:
ACCUMULATED
ADDITIONAL DISTRIBUTIONS
PAID-IN IN EXCESS OF
SHARES STOCK CAPITAL NET INCOME TOTAL
---------- -------- ---------- ------------- ----------
Stockholders' Equity at December 31, 2001 16,348,000* $ 2 $ 210,820 $ (48,198) $ 162,624
Stock Options Exercised 163,000 -- 3,631 -- 3,631
Net Income for the Period -- -- -- 4,298 4,298
Distributions Accrued -- -- -- (8,400) (8,400)
---------- -------- ---------- ------------- ----------
Stockholders' Equity at March 31, 2002 16,511,000 $ 2 $ 214,451 $ (52,300) $ 162,153
========== ======== ========== ============= ==========
- ------------------------
* Includes 16,148,000 outstanding shares of Common Stock and 200,000
outstanding shares of Price Group Stock.
6. SEGMENT INFORMATION
The following information presents the Company's three reportable segments
- - (1) regional malls, (2) community centers and (3) commercial Properties in
conformity with SFAS No. 131, "Disclosures about Segments of an Enterprise and
Related Information".
The accounting policies of the segments are the same as those described in
the "Summary of Significant Accounting Policies" in the Company's Annual Report
on Form 10-K/A for the year ended December 31, 2001. Segment data includes
total revenues and property net operating income (revenues less property
operating expenses ("Property NOI")). The Company evaluates the performance of
its segments and allocates resources to them based on Property NOI.
10
JP REALTY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
6. SEGMENT INFORMATION (CONTINUED)
The regional mall segment consists of 18 regional malls in eight states
containing approximately 10,414,000 square feet of total gross leasable area
("GLA") and which range in size from approximately 301,000 to 1,166,000 square
feet of total GLA.
The community center segment consists of 25 properties in eight states
containing approximately 3,427,000 square feet of total GLA and one
freestanding retail property containing approximately 2,000 square feet of GLA.
The commercial properties include six mixed-use commercial/business
properties with 38 commercial buildings containing approximately 1,355,000
square feet of GLA which are located primarily in the Salt Lake City, Utah area
where the Company's headquarters is located.
The table below presents information about the Company's reportable
segments for the quarters ending March 31:
REGIONAL COMMUNITY COMMERCIAL
MALLS CENTERS PROPERTIES OTHER TOTAL
--------- ----------- ---------- ---------- ----------
2002
- ----
Total Revenues $ 28,580 $ 5,101 $ 1,881 $ 131 $ 35,693
Property Operating Expenses (1) (8,924) (1,228) (414) -- (10,566)
--------- ----------- ---------- ---------- ----------
Property NOI (2) 19,656 3,873 1,467 131 25,127
Unallocated Expenses (3) -- -- -- (17,237) (17,237)
Unallocated Minority Interest (4) -- -- -- (3,592) (3,592)
Consolidated Net Income -- -- -- -- 4,298
Additions to Real Estate Assets 2,588 739 42 -- 3,369
Total Assets (5) 657,947 88,821 28,953 13,708 789,429
2001
- ----
Total Revenues $ 28,017 $ 5,015 $ 1,899 $ 89 $ 35,020
Property Operating Expenses (1) (8,505) (1,101) (373) -- (9,979)
--------- ----------- ---------- ---------- ----------
Property NOI (2) 19,512 3,914 1,526 89 25,041
Unallocated Expenses (3) -- -- -- (17,602) (17,602)
Unallocated Minority Interest (4) -- -- -- (3,535) (3,535)
Unallocated Other (6) -- -- -- 872 872
Consolidated Net Income -- -- -- -- 4,776
Additions to Real Estate Assets 1,744 3,015 211 -- 4,970
Total Assets (5) 662,823 81,724 29,565 13,299 787,411
- ---------------------------
(1) Property operating expenses consist of operating, maintenance, real estate
taxes and insurance, advertising and promotion expenses as listed in the
consolidated statement of operations.
(2) Total revenues minus property operating expenses.
(3) Unallocated expenses consist of general and administrative, merger
expenses, depreciation, amortization of deferred financing costs,
amortization of deferred leasing costs and interest as listed in the
consolidated statement of operations.
(4) Unallocated minority interest includes minority interest in (income) loss
of consolidated partnerships and minority interest of the Operating
Partnership preferred and common unitholders as listed in the consolidated
statement of operations.
(5) Unallocated other total assets include cash, corporate offices,
miscellaneous real estate and deferred financing costs.
(6) Unallocated other includes gain on sales of real estate as listed in the
consolidated statement of operations.
11
JP REALTY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
7. PROPOSED MERGER
On March 3, 2002, the Company and the Operating Partnership entered into
a definitive Agreement and Plan of Merger (the "Merger Agreement") with General
Growth Properties, Inc. ("GGP") and its operating partnership subsidiary, GGP
Limited Partnership ("GGP OP"), pursuant to which the Company and the Operating
Partnership will merge into indirect wholly owned subsidiaries of GGP OP.
The total acquisition price will be approximately $1,100,000, which
includes assumption of approximately $460,000 of existing debt and $116,000 of
the Operating Partnership's existing preferred units. Pursuant to the terms of
the Merger Agreement, each of the outstanding shares of the Company's Common
Stock will be exchanged for $26.10 per share cash. Each common unit of the
Operating Partnership will be exchanged for either $26.10 in cash or .522
Series B 8.5% Convertible Preferred Units of GGP OP, convertible into General
Growth common stock based on a conversion price of $50 per share.
The Merger Agreement has been unanimously approved by the Company's board
of directors. The merger is subject to customary closing conditions, including
the approval of the transaction by the Company's stockholders. The Merger
Agreement does not contain any financing contingencies. It is anticipated that
the transaction will be closed in the second quarter of 2002.
8. SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
MARCH 31, MARCH 31,
2002 2001
----------- ------------
SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTIONS
The following non-cash transactions occurred:
Distributions Accrued For Stockholders not Paid $ 8,400 $ 8,009
Distributions Accrued For Common Unitholders not Paid $ 1,856 $ 1,801
Distributions Accrued For Preferred Unitholders not Paid $ 2,125 $ --
9. SUBSEQUENT EVENT
On May 3, 2002, the Operating Partnership purchased Country Hills Plaza
Shopping Center in Ogden, Utah. This property is a community center anchored
by Smith's Food King and contains approximately 128,800 square feet and is
currently 98% occupied. The purchase price for this property was $12,700. The
Operating Partnership assumed debt of $5,683 with an interest rate of 7.375%
due in May 2021, callable by lender and pre-payable in May 2006, and paid the
balance of $7,017 in cash received from the proceeds of the sale of Fry's
Shopping Plaza on November 5, 2001. The sale qualified as a Section 1031
exchange for federal income tax purposes.
12
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
------------------------------------------------------------------------
OF OPERATIONS
-------------
OVERVIEW
The following discussion should be read in conjunction with the
consolidated financial statements of the Company and the notes thereto
appearing elsewhere herein.
The Company is a fully integrated, self-administered and self-managed
REIT primarily engaged in the ownership, leasing, management, operation,
development, redevelopment and acquisition of retail properties in Utah, Idaho,
Colorado, Arizona, Nevada, New Mexico and Wyoming (the "Intermountain Region"),
as well as in Oregon, Washington and California. The Company conducts all of
its business operations through, and held a controlling general interest in,
the Operating Partnership as of March 31, 2002. The Operating Partnership's
existing portfolio consists of 51 properties, in three operating segments,
including 18 enclosed regional malls, 26 community centers together with one
free-standing retail property and six mixed-use commercial properties.
The Company accounts for all its controlled affiliates in the Company's
consolidated financial statements and all significant intercompany balances
have been eliminated.
CRITICAL ACCOUNTING POLICIES
The following discussion and analysis of our financial condition and
results of operations are based upon our consolidated financial statements,
which have been prepared in accordance with accounting principles generally
accepted in the United States. The preparation of our financial statements
requires us to make estimates and judgments about the effects of matters or
future events that are inherently uncertain. These estimates and judgments may
affect the reported amounts of assets, liabilities, revenues and expenses, and
related disclosure of contingent assets and liabilities. On an on-going basis,
we evaluate our estimates, including contingencies and litigation. We base
these estimates on historical experience and on various other assumptions that
we believe to be reasonable in the circumstances. Those estimates form the
basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ
from these estimates under different assumptions or conditions.
To assist in understanding our results of operations and financial
position, we have identified our critical accounting policies and discussed
them below. These accounting policies are most important to the portrayal of
our results and financial position, either because of the significance of the
financial statement items to which they relate or because they require
management's most difficult, subjective or complex judgments.
REVENUE RECOGNITION AND ACCOUNTS RECEIVABLE
Certain minimum rents are recognized monthly based upon amounts which are
currently due from tenants, when such amounts are not materially different than
recognizing the fixed cash flow over the initial term of the lease using the
straight-line method. Certain leases have in-lieu rents, which cover all rent
charges and recoveries and are recorded as minimum rents. All other minimum
rents are recognized using the straight-line method. Certain of these leases
provide for percentage and overage rents based upon the level of sales achieved
by the lessee. These percentage rents are accrued once the required sales
level is achieved. The leases also typically provide for tenant reimbursements
of common area maintenance, insurance and real estate taxes. Income from
tenant reimbursements and other property related income, which includes the
leasing of vacant space to temporary tenants, is recognized in the period
earned. Lease termination fees are included in minimum rents and recognized
upon termination of a tenant lease.
The Company makes estimates of the collectivity of its accounts
receivable. The Company specifically analyzes accounts receivable and analyzes
historical bad debts, customer credit worthiness, current economic trends and
changes in customer payment terms when evaluating the adequacy of the allowance
for doubtful accounts. These estimates have a direct impact on the Company's
net income, because a higher bad debt reserve results in less net income.
13
PROPERTY
Costs directly related to the acquisition and development of real estate
assets, including overhead costs directly attributable to property development,
are capitalized. Interest and real estate taxes incurred during the
development and construction periods are also capitalized.
Depreciation is computed on a straight-line basis generally over 40 years
for buildings and four to ten years for equipment and fixtures. Tenant
improvements are capitalized and depreciated on a straight-line basis over the
shorter of the asset's estimated useful life or the life of the related lease.
Expenditures for maintenance and repairs are charged to operations as incurred.
Major replacements and betterments which improve or extend the life of the
assets are capitalized and depreciated over their estimated useful lives.
At each balance sheet date, the Company assesses whether there has been
an impairment in the value of its long-lived assets by considering factors such
as expected future operating income, trends and prospects, as well as the
effects of demand, competition and other economic factors. Such factors
include the tenants ability to perform their duties and pay rent under the
terms of the leases. The Company may recognize an impairment loss if the
income stream is not sufficient to cover its investment. Such a loss would be
determined as the difference between the carrying value and the fair value of a
property. If such a loss were recognized it could have a significant impact on
the Company's net income.
DEFERRED CHARGES
Deferred charges consist principally of financing fees and leasing
commissions paid to third parties. These costs are amortized on a straight-
line basis over the terms of the respective agreements and are recorded in the
consolidated statement of operations in amortization of deferred financing
costs and amortization of deferred leasing cost which amounts, for deferred
financing fees, approximate those amortized using the effective interest
method.
INCOME TAXES
The Company has elected to be taxed as a REIT under the Internal Revenue
Code of 1986, as amended (the "Code"), commencing with the taxable year ended
December 31, 1994. To qualify as a REIT, the Company must distribute annually
to its stockholders at least 90% of its REIT taxable income, as defined in the
Code, and satisfy certain other requirements. The Company intends to
distribute at least 100% of its estimated REIT taxable income each year and, as
a result, it is not taxed under the Code. If the Company fails to meet the
qualifications as a REIT it would be required to pay income taxes at regular
corporate income tax rates.
RESULTS OF OPERATIONS
COMPARISON OF THREE MONTHS ENDED MARCH 31, 2002 TO THREE MONTHS ENDED MARCH
31, 2001
REVENUES
Total revenues increased 1.9%, or $673,000, for the quarter ended March
31, 2002. Of the $673,000 increase, $563,000 was the result of increased
revenues at the regional malls, $86,000 was the result of increased revenues at
the community centers and $18,000 was the result of decreased revenues at the
commercial properties. An increase of $42,000 was not allocated to a
particular property segment.
MINIMUM RENTS
Minimum rents increased 3.0%, or $771,000, for the quarter ended March
31, 2002. Minimum rents increased by $672,000 at the regional malls primarily
due to overall growth throughout the regional mall portfolio. Minimum rents
increased by $124,000 at the community centers due to the October 2001 opening
of the Spokane Valley Mall Plaza in Spokane, Washington together with overall
growth throughout the properties offset by lost minimum rents due to the
November 2001 sale of Fry's Shopping Plaza in Glendale, Arizona and $237,000
from lease termination settlements in 2001. Minimum rents at the commercial
properties decreased by $49,000. Amounts not allocated to a particular segment
increased by $24,000.
14
PERCENTAGE AND OVERAGE RENTS
Percentage and overage rents decreased 18.2%, or $130,000, for the
quarter ended March 31, 2002. Percentage and overage rents decreased by
$106,000 at the regional malls and $24,000 at the community centers.
RECOVERIES FROM TENANTS
Recoveries from tenants increased 0.9%, or $74,000, for the quarter ended
March 31, 2002. Recoveries from tenants increased by $6,000 at the regional
malls, $37,000 at the community centers and $31,000 at the commercial
properties.
INTEREST AND OTHER REVENUES
Interest and other revenues decreased by 8.8%, or $42,000, for the
quarter ended March 31, 2002.
EXPENSES
Total expenses increased 0.8%, or $222,000, for the quarter ended March
31, 2002. Property operating expenses (operating and maintenance; real estate
taxes and insurance; and advertising and promotions) increased by $587,000,
general and administrative expenses decreased by $192,000, merger expenses
increased by $1,864,000, depreciation and amortization decreased by $155,000,
and interest decreased by $1,882,000.
PROPERTY OPERATING EXPENSES
Property operating expenses (operating and maintenance; real estate taxes
and insurance; and advertising and promotions) increased by $419,000 at the
regional malls, $127,000 at the community centers and $41,000 at the commercial
properties.
GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses decreased by $192,000 for the quarter
ended March 31, 2002. The decrease is primarily related to decreased employee
payroll and benefit costs, computer services and legal expenses.
MERGER EXPENSE
Expenses incurred for the proposed merger with General Growth Properties,
Inc. were $1,864,000 for the quarter ended March 31, 2002. There were no such
expenses in the quarter ended March 31, 2001.
DEPRECIATION AND AMORTIZATION
Depreciation and amortization decreased by $155,000 for the quarter ended
March 31, 2002. This decrease is attributable to the reduction in asset lives
on certain tenant improvements for the quarter ended March 31, 2001 of $400,000
compared to $6,000 for the quarter ended March 31, 2002, offset by additional
depreciation on the new community center of Spokane Valley Mall Plaza and
additional tenant allowances.
INTEREST EXPENSE/CAPITALIZED INTEREST
Interest expense decreased by $1,882,000 for the quarter ended March 31,
2002. The decrease in interest expense is the result of lower interest rates
on the Company's variable rate debt. Interest capitalized on projects under
development was $34,000 in 2002 compared to $88,000 in 2001.
15
MINORITY INTEREST IN (INCOME) LOSS OF CONSOLIDATED PARTNERSHIPS
Income attributable to minority interest increased $171,000 to $59,000
income in 2002 compared to $112,000 loss in 2001. This is mainly due to a
consolidated partnership where cumulative losses now exceed the limited
partners' investment in such consolidated partnership and such losses
previously attributable to its limited partners are now recognized by the
Company.
GAIN ON SALES OF REAL ESTATE
Gain on sales of real estate decreased by $872,000 due to a sale of an
out parcel with a gain of $872,000 during the quarter ended March 31, 2001 and
no such sales occurred during the quarter ended March 31, 2002.
LIQUIDITY AND CAPITAL RESOURCES
The Company's principal uses of its liquidity and capital resources have
historically been for distributions, property acquisitions, property
development, expansion and renovation programs and debt repayment. To maintain
its qualification as a REIT under the Code, JP Realty, Inc. is required to
distribute to its stockholders at least 90% of its "Real Estate Investment
Trust Taxable Income," as defined in the Code. For the quarter ended March 31,
2002, JP Realty, Inc. declared a dividend of $.51 per share payable April 16,
2002 to the stockholders of record as of April 4, 2002. The Operating
Partnership declared a distribution of $.51 per partnership unit payable April
16, 2002, to partners of record as of April 4, 2002.
The Company's principal source of liquidity is its cash flow from
operations generated from its real estate investments. As of March 31, 2002,
the Company's cash and restricted cash amounted to approximately $16.1 million.
In addition to its cash and restricted cash, unused capacity under the
Operating Partnership's credit facility at March 31, 2002 totaled $94 million.
The Company expects to meet its short-term liquidity requirements,
including distributions, recurring capital expenditures related to maintenance
and improvement of existing properties, through undistributed funds from
operations, cash balances and advances under the Operating Partnership's credit
facility.
The Company's principal long-term liquidity requirements will be the
repayment of principal on its outstanding secured and unsecured indebtedness.
At March 31, 2002, the Company's total outstanding indebtedness was
approximately $460.2 million. Such indebtedness included: (i) the Provo Towne
Centre construction loan of approximately $44.1 million which is due in July
2003; (ii) the Spokane Valley Mall construction loan of $47.3 million which is
due in July 2003; (iii) the Operating Partnership's credit facility with a
balance of $106.0 million maturing July 2003; (iv) the $100.0 million senior
notes with a principal payable of $25 million per year beginning March 2005;
(vi) the $81.3 million, 6.68% first mortgage on NorthTown Mall which requires a
balloon payment of approximately $73.0 million in September 2008; and (v) the
$78.1 million, 6.64% first mortgage on Boise Towne Square which requires a
balloon payment of approximately $68.4 million in February 2011.
Quarterly distributions to the preferred unitholders of approximately
$278,900, $2,125,600 and $175,000 are due to the holders of the Series A,
Series B and Series C Preferred Units, respectively, on the last day of each
March, June, September and December of each year. If the last day of each
payment period falls on a non-business day, payment is due on the immediately
preceding business day for Series A and C and on the following day for Series
B, except that payment for the Series B fourth quarter distributions must be
made in December.
The Company is currently involved in expansion and renovation projects at
several of its properties, which are expected to be financed with the Operating
Partnership's credit facility. The Company is also contemplating additional
development projects and acquisitions as a means to expand its portfolio. The
Company does not expect to generate sufficient funds from operations to meet
such long-term needs and intends to finance these costs primarily through
advances under the Operating Partnership's credit facility together with equity
and debt offerings, individual property financing and selective asset sales.
The availability of such financing will influence the Company's decision to
proceed with, and the pace of, its development and acquisition activities.
On September 2, 1997, the Company and the Operating Partnership filed a
shelf registration statement on Form S-3 with the Securities and Exchange
Commission for the purpose of registering common stock, preferred stock,
depositary shares, common stock warrants, debt securities and guarantees. This
registration statement, when combined with the Company's unused
16
portion of its previous shelf registration, would allow for up to $400 million
of securities to be offered by the Company and the Operating Partnership. On
March 11, 1998, pursuant to this registration statement, the Operating
Partnership issued $100 million of ten-year senior unsecured notes bearing
annual interest at a rate of 7.29%. The Operating Partnership had entered into
an interest rate protection agreement in anticipation of issuing these notes
and received $270,000 as a result of terminating this agreement making the
effective rate of interest on these notes 7.26%. Interest payments are due
semi-annually on March 11th and September 11th of each year. Principal payments
of $25 million are due annually beginning March 2005. The proceeds were used
to partially repay outstanding borrowings under the Operating Partnership's
prior credit facility. At March 31, 2002, the Company and the Operating
Partnership had an aggregate of $300 million in registered securities
available under its effective shelf registration statement.
The Company intends to fund its distribution, development, expansion,
renovation, acquisition and debt repayment activities from the Operating
Partnership's credit facility, from other debt and equity financings, including
public financing and from selective asset sales. The Company's ratio of debt-
to-total market capitalization was approximately 41.3% at March 31, 2002.
On March 3, 2002, the Company and the Operating Partnership entered into a
definitive Merger Agreement with GGP and its operating partnership subsidiary,
GGP OP, pursuant to which the Company and the Operating Partnership will merge
into indirect wholly owned subsidiaries of GGP OP. The total acquisition price
will be approximately $1.1 billion, which includes assumption of approximately
$460 million of existing debt and $116 million of the Operating Partnership's
existing preferred units. Pursuant to the terms of the Merger Agreement, each
of the outstanding shares of the Company's Common Stock will be exchanged for
either $26.10 per share cash. Each common unit of the Operating Partnership
will be exchanged for either $26.10 in cash or .522 Series B 8.5% Convertible
Preferred Unit of GGP OP, convertible into General Growth common stock based on
a conversion price of $50 per share. The Merger Agreement authorizes the
Company and the Operating partnership to declare and pay regular quarterly
dividends/distributions for the first quarter and a pro rated dividend through
the closing date of the merger. The Merger Agreement has been unanimously
approved by the Company's board of directors. The merger is subject to
customary closing conditions, including the approval of the transaction by the
Company's stockholders. The Merger Agreement does not contain any financing
contingencies. It is anticipated that the transaction will be closed in the
second quarter of 2002. The merger with GGP OP will not require use of the
Company's cash except to pay for certain expenses relating to such merger.
Net cash provided by operating activities for the quarter ended March 31,
2002 was $17,848,000 versus $16,298,000 for the corresponding period of 2001.
Net income adjusted for non-cash items accounted for a $155,000 decrease, while
changes in operating assets and liabilities accounted for a $1,705,000 increase
in cash.
Net cash used in investing activities for the quarter ended March 31, 2002
was $2,125,000. It primarily reflects real estate asset investments of
$3,369,000 and a decrease in restricted cash of $1,244,000.
Net cash used in financing activities for the quarter ended March 31, 2002
was $15,481,000. Cash was received from borrowings of $1,000,000 and net
proceeds from the sale of common stock from stock options exercised was
$3,631,000. Cash was used to repay borrowings in the amount of $19,483,000,
for distributions to preferred unitholders in the amount of $454,000 and to
minority interests in the amount of $70,000, along with the payment of $105,000
of deferred financing costs.
The statements contained in this Quarterly Report of Form 10-Q that are not
purely historical fact are forward looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and as such may involve known and
unknown risks, uncertainties and assumptions. Actual future performance,
achievements and results of the Company may differ materially from those
expressed or implied by such forward-looking statements as a result of such
known and unknown risks, uncertainties, assumptions and other factors.
Representative examples of these factors include, without limitation, general
industry and economic conditions, interest rate trends, cost of capital and
capital requirements, availability of real estate properties, competition from
other companies and venues for the sale/distribution of goods and services,
shifts in customer demands, tenant bankruptcies, governmental and public policy
changes, the effects of the pending Merger Agreement and the related proposed
merger and the continued availability of financing in the amounts and on the
terms necessary to support the future business of the Company. Readers are
cautioned that the Company's actual results could differ materially from those
set forth in such forward-looking statements.
17
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
----------------------------------------------------------
The Company's exposure to market risk is limited to fluctuations in the
general level of interest rates on its current and future fixed and variable
rate debt obligations. The Company is vulnerable to significant fluctuations
in interest rates on its variable rate debt, on any future repricing or
refinancing of its fixed rate debt and on future debt.
The Company uses long-term and medium-term debt as a source of capital. At
March 31, 2002, the Company had approximately $262,774,000 of outstanding fixed
rate debt, consisting of $100,000,000 in unsecured senior notes and
$162,774,000 in mortgages and notes secured by real estate. The various fixed
rate debt instruments mature starting in the year 2003 through 2095. The
weighted average rate of interest on the fixed rate debt was approximately
6.92% for the period ended March 31, 2002. When debt instruments of this type
mature, the Company typically refinances such debt at the then-existing market
interest rates which may be more or less than the interest rates on the
maturing debt. Changes in general market interest rates will affect the fair
value of the Company's fixed rate debt (i.e. as the interest rates increase the
fair value of the debt decreases and as interest rates decrease the fair value
of the debt increases), but will not have an effect on the interest rate,
interest expense or cash flow of such debt. In addition, the Company may
attempt to reduce interest rate risk associated with a forecasted issuance of
new fixed rate debt by entering into interest rate protection agreements.
Additionally, $1,425,000 of scheduled principal amortization payments are due
during the second through the fourth quarters of 2002.
The Operating Partnership's credit facility and existing construction loans
have variable interest rates and any fluctuation in interest rates could
increase or decrease the Company's interest expense. The Operating
Partnership's credit facility borrowings are primarily transacted utilizing a
variable interest rate tied to LIBOR, which as of March 31, 2002 was equal to
LIBOR plus 110 basis points. The interest rate on the construction loan and
loan facility as of March 31, 2002 was equal to LIBOR plus 150 basis points.
The LIBOR rate used is at the Company's option and is based upon the 30, 60 or
90 day LIBOR rate. A change in the LIBOR rate will effect the Company's
interest expense and cash flow. At March 31, 2002, the Company had
approximately $197,425,000 in outstanding variable rate debt. The weighted
average rate of interest on the variable interest rate debt was approximately
3.13% for the period ended March 31, 2002. If the interest rate for the
Company's variable rate debt increased or decreased by 1.0%, the Company's
annual interest expense on its then outstanding variable rate debt would
increase or decrease, as the case may be, by approximately $1,974,000.
Due to the uncertainty of fluctuations in interest rates and the specific
actions that might be taken by the Company to mitigate the impact of such
fluctuations and their possible effects, the foregoing sensitivity analysis
assumes no changes in the Company's financial and credit structure.
18
PART II
ITEM 1. LEGAL PROCEEDINGS
-----------------
The Company is not aware of any pending or threatened litigation at
this time that will have a material adverse effect on the Company or any
of its properties.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
-----------------------------------------
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
-------------------------------
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
---------------------------------------------------
Not applicable.
ITEM 5. OTHER INFORMATION
-----------------
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
19
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
2.1 Agreement and Plan of Merger, dated March 3, 2002, by and among the Company, Price Development
Company, Limited Partnership, General Growth Properties, Inc. and GGP Limited Partnership{(1)}
3.1 Amended and Restated Articles of Incorporation the Company (3(a)){(2)}
3.3 Articles Supplementary of the Company relating to the 8.75 Series A Cumulative Redeemable
Preferred Stock{(4)}
3.4 Articles Supplementary of the Company relating to the 8.95% Series B Cumulative Redeemable
Preferred Stock{(4)}
3.5 Articles Supplementary of the Company relating to the election to be subject to Title 3, Subtitle
8 of the Maryland General Corporation Law{(3)}
3.6 Articles Supplementary of the Company relating to the Series A Junior Preferred Stock{(5)}
3.7 Amendment to the Bylaws of the Company{(3)}
3.8 Amended and Restated By-Laws of the Company{(3)}
3.9 Articles Supplementary of the Company relating to the 8.75 Series C Cumulative Redeemable
Preferred Stock{(3)}
4.1 Specimen of Common Stock Certificate (4){(2)}
10.1 Second Amended and Restated Agreement of Limited Partnership of Price Development Company, Limited
Partnership{(4)}
10.2 Agreement of Limited Partnership of Price Financing Partnership, L.P. (10(b)){(2)}
10.3 Employment and Non-Competition Agreement between the Company and John Price (10(d)){(2)}
10.4 Indemnification Agreement for Directors and Officers (10(f)){(2)}
10.5 Registration Rights Agreement among the Company and the Limited Partners of Price Development
Company, Limited Partnership (10(g)){(2)}
10.6 Amendment No. 1 to Registration Rights Agreement, dated August 1, 1995, among the Company and the
Limited Partners of Price Development Company, Limited Partnership{(6)}
10.7 Exchange Agreement among the Company and the Limited Partners of Price Development Company,
Limited Partnership (10(h)){(2)}
10.8 1993 Stock Option Plan (10(i)){(2)}
10.9 Amendment to Ground lease between Price Development Company and Alvin Malstrom as Trustee and C.F.
Malstrom, dated December 31, 1985. (Ground lease for Plaza 9400) (10(j)){(2)}
10.10 Lease Agreement between The Corporation of the President of the Church of Jesus Christ of Latter
Day Saints and Price-James and Assumptions, dated September 24, 1979. (Ground lease for Anaheim
Plaza) (10(k)){(2)}
10.11 Indenture of Lease between Ambrose and Zelda Motta and Cordova Village, dated July 26, 1974, and
Amendments and Transfers thereto. (Ground lease for Fort Union Plaza) (10(l)){(2)}
10.12 Lease Agreement between Advance Management Corporation and Price Rentals, Inc. and dated August 1,
1975 and Amendments thereto. (Ground lease for Price Fremont) (10(m)){(2)}
10.13 Ground lease between Aldo Rossi and Price Development Company, dated June 1, 1989, and related
documents. (Ground lease for Halsey Crossing) (10(n)){(2)}
10.14 First Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(4)}
10.15 Second Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(4)}
10.16 Third Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(7)}
10.17 Amended and Restated Rights Agreement between the Company and Investor Services, LLC, as Rights
Agent{(9)}
10.18 Fourth Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(8)}
10.19 Fifth Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(10)}
10.20 Sixth Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(11)}
20
- ----------------------
{(1)} Document was previously filed with the Company's current report on Form 8-K dated March 3, 2002, and is
incorporated herein by reference.
{(2)} Documents were previously filed with the Company's Registration Statement on Form S-11, File No. 33-68844,
under the exhibit numbered in parenthetical, and are incorporated herein by reference.
{(3)} Document was previously filed with the Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
2000 and is incorporated herein by reference.
{(4)} Documents were previously filed with the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1999 and are incorporated herein by reference.
{(5)} Documents were previously filed with the Company's current report on Form 8-K, dated August 13, 1999, and are
incorporated herein by reference.
{(6)} Documents were previously filed with the Company's Annual Report on Form 10-K for the year ended December 31,
1995 and are incorporated herein by reference.
{(7)} Document was previously filed with the Company's Quarterly Report on Form 10-Q for the quarter ended September
30, 1999 and is incorporated herein by reference.
{(8)} Document was previously filed with the Company's Annual Report on Form 10-K for the year ended December 31,
1999 and is incorporated herein by reference.
{(9)} Document was previously filed with the Company's Current Report on Form 8-K dated January 29, 2001 and is
incorporated herein by reference.
{(10)} Document was previously filed with the Company's Quarterly report on Form 10-Q for the quarter ended March 31,
2000 and is incorporated herein by reference.
{(11)} Document was previously filed with the Company's Annual Report on Form 10-K for the year ended December 31,
2000 and is incorporated herein by reference.
(b) CURRENT REPORTS ON FORM 8-K
On March 3, 2002, the Company filed a Current Report on Form
8-K containing Item No. 5 "Other Events" information relating
to a definitive Agreement and Plan of Merger with General
Growth Properties Inc. and its operating partnership subsidiary,
GGP Limited Partnership ("GGP OP"), pursuant to which JP Realty,
Inc. and Price Development Company, Limited Partnership will
merge into indirect wholly owned subsidiaries of GGP OP.
On March 13, 2002, the Company filed a Current Report on Form
8-K under Item No. 5 "Other Events" information relating to
the resignation of its Chairman of the Board of Directors and
Chief Executive Office, Mr. John Price, effective March 14,
2002.
21
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
JP REALTY, INC.
(Registrant)
May 8, 2002 /s/ G. Rex Frazier
- --------------------------------------------- -----------------------------------
(Date) G. Rex Frazier
PRESIDENT, CHIEF EXECUTIVE OFFICER,
AND DIRECTOR
May 8, 2002 /s/ M. Scott Collins
- ---------------------------------------------- -----------------------------------
(Date) M. Scott Collins
VICE PRESIDENT--CHIEF FINANCIAL OFFICER
(PRINCIPAL FINANCIAL
& ACCOUNTING OFFICER)
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
2.1 Agreement and Plan of Merger, dated March 3, 2002, by and among the Company, Price Development
Company, Limited Partnership, General Growth Properties, Inc. and GGP Limited Partnership{(1)}
3.1 Amended and Restated Articles of Incorporation the Company (3(a)){(2)}
3.3 Articles Supplementary of the Company relating to the 8.75 Series A Cumulative Redeemable
Preferred Stock{(4)}
3.4 Articles Supplementary of the Company relating to the 8.95% Series B Cumulative Redeemable
Preferred Stock{(4)}
3.5 Articles Supplementary of the Company relating to the election to be subject to Title 3, Subtitle
8 of the Maryland General Corporation Law{(3)}
3.6 Articles Supplementary of the Company relating to the Series A Junior Preferred Stock{(5)}
3.7 Amendment to the Bylaws of the Company{(3)}
3.8 Amended and Restated By-Laws of the Company{(3)}
3.9 Articles Supplementary of the Company relating to the 8.75 Series C Cumulative Redeemable
Preferred Stock{(3)}
4.1 Specimen of Common Stock Certificate (4){(2)}
10.1 Second Amended and Restated Agreement of Limited Partnership of Price Development Company, Limited
Partnership{(4)}
10.2 Agreement of Limited Partnership of Price Financing Partnership, L.P. (10(b)){(2)}
10.3 Employment and Non-Competition Agreement between the Company and John Price (10(d)){(2)}
10.4 Indemnification Agreement for Directors and Officers (10(f)){(2)}
10.5 Registration Rights Agreement among the Company and the Limited Partners of Price Development
Company, Limited Partnership (10(g)){(2)}
10.6 Amendment No. 1 to Registration Rights Agreement, dated August 1, 1995, among the Company and the
Limited Partners of Price Development Company, Limited Partnership{(6)}
10.7 Exchange Agreement among the Company and the Limited Partners of Price Development Company,
Limited Partnership (10(h)){(2)}
10.8 1993 Stock Option Plan (10(i)){(2)}
10.9 Amendment to Ground lease between Price Development Company and Alvin Malstrom as Trustee and C.F.
Malstrom, dated December 31, 1985. (Ground lease for Plaza 9400) (10(j)){(2)}
10.10 Lease Agreement between The Corporation of the President of the Church of Jesus Christ of Latter
Day Saints and Price-James and Assumptions, dated September 24, 1979. (Ground lease for Anaheim
Plaza) (10(k)){(2)}
10.11 Indenture of Lease between Ambrose and Zelda Motta and Cordova Village, dated July 26, 1974, and
Amendments and Transfers thereto. (Ground lease for Fort Union Plaza) (10(l)){(2)}
10.12 Lease Agreement between Advance Management Corporation and Price Rentals, Inc. and dated August 1,
1975 and Amendments thereto. (Ground lease for Price Fremont) (10(m)){(2)}
10.13 Ground lease between Aldo Rossi and Price Development Company, dated June 1, 1989, and related
documents. (Ground lease for Halsey Crossing) (10(n)){(2)}
10.14 First Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(4)}
10.15 Second Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(4)}
10.16 Third Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(7)}
10.17 Amended and Restated Rights Agreement between the Company and Investor Services, LLC, as Rights
Agent{(9)}
10.18 Fourth Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(8)}
10.19 Fifth Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(10)}
10.20 Sixth Amendment to Second Amended and Restated Agreement of Limited Partnership of Price
Development Company, Limited Partnership{(11)}
- ----------------------
{(1)} Document was previously filed with the Company's current report on Form 8-K dated March 3, 2002, and is
incorporated herein by reference.
{(2)} Documents were previously filed with the Company's Registration Statement on Form S-11, File No. 33-68844,
under the exhibit numbered in parenthetical, and are incorporated herein by reference.
{(3)} Document was previously filed with the Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
2000 and is incorporated herein by reference.
{(4)} Documents were previously filed with the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1999 and are incorporated herein by reference.
{(5)} Documents were previously filed with the Company's current report on Form 8-K, dated August 13, 1999, and are
incorporated herein by reference.
{(6)} Documents were previously filed with the Company's Annual Report on Form 10-K for the year ended December 31,
1995 and are incorporated herein by reference.
{(7)} Document was previously filed with the Company's Quarterly Report on Form 10-Q for the quarter ended September
30, 1999 and is incorporated herein by reference.
{(8)} Document was previously filed with the Company's Annual Report on Form 10-K for the year ended December 31,
1999 and is incorporated herein by reference.
{(9)} Document was previously filed with the Company's Current Report on Form 8-K dated January 29, 2001 and is
incorporated herein by reference.
{(10)} Document was previously filed with the Company's Quarterly report on Form 10-Q for the quarter ended March 31,
2000 and is incorporated herein by reference.
{(11)} Document was previously filed with the Company's Annual Report on Form 10-K for the year ended December 31,
2000 and is incorporated herein by reference.