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
Date of Report (Date of earliest event reported) July 1, 2003
-----------------------------
American Realty Investors, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Nevada 1-15663 75-2847135
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
1800 Valley View Lane, Suite 300, Dallas, Texas 75234
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 469-522-4200
------------------------------
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
-1-
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE
Effective June 30, 2003, that certain Advisory Agreement dated as of
August 3, 2000, between American Realty Investors, Inc. ("ARI") and Basic
Capital Management, Inc. ("BCM") was terminated by mutual agreement. BCM had
served as ARI's advisor since August 3, 2000. BCM is a Nevada corporation in
which Messrs. Mark W. Branigan (Executive Vice President - Residential), Louis
J. Corna (Executive Vice President - Tax) and Ronald E. Kimbrough (acting
Principal Executive Officer, Executive Vice President and Chief Financial
Officer) are executive officers.
On July 1, 2003, ARI entered into an Advisory Agreement with Prime
Asset Management, Inc., a Nevada corporation ("Prime"). The Advisory Agreement
dated July 1, 2003 (the "Advisory Agreement") between ARI and Prime contains the
same terms as the prior Advisory Agreement with BCM. A copy of the Advisory
Agreement dated July 1, 2003 between ARI and Prime is attached hereto as an
exhibit.
The directors and principal officers of Prime are the same as the
directors and officers of BCM. The Common Stock of Prime is owned 79% by Realty
Advisors, Inc., a Nevada corporation ("RAI"), which in turn is owned by a trust
established for the benefit of the children of Gene E. Phillips. The balance of
21% of the Common Stock of Prime is owned by Syntek West, Inc., a Nevada
corporation ("SWI"), all of the issued and outstanding common stock of which is
owned by Gene E. Phillips.
The directors and principal officers of Prime are:
Mickey N. Phillips Director
Ryan T. Phillips Director
Mark W. Branigan Executive Vice President - Residential
Louis J. Corna Executive Vice President - Tax
Ronald E. Kimbrough Acting Principal Executive Officer,
Executive Vice President and Chief
Financial Officer
Robert A. Waldman Senior Vice President, Secretary and
General Counsel
On July 1, 2003, Richard W. Humphrey, a director since November 2001,
resigned as a member of the Board of Directors. Mr. Humphrey is a real estate
broker of Regis Realty I LLC and President of Unified Housing Foundation, a
non-profit corporation. Mr. Humphrey has not furnished ARI with any letter
describing any disagreement or requesting that any disclosure be made.
Also on July 1, 2003, the remaining directors, Earl D. Cecil, Ted P.
Stokley and Joseph Mizrachi increased the number of directors to five and
elected Henry A. Butler and Martin L. White as directors of ARI to fill the
vacancies
-2-
created by the resignation of Richard W. Humphrey and the increase in the number
of Board members. Henry A. Butler is a real estate broker specializing in major
U.S. markets employed by BCM since 1992. Mr. Butler also serves as a director of
Transcontinental Realty Investors, Inc. ("TCI") and served as a director of
Income Opportunity Realty Investors, Inc. ("IOT") until his resignation on June
30, 2003.
Martin L. White is a licensed California real estate broker and
investment advisor. He is the Chief Executive Officer of Prime Consultants Group
which specializes in business and residential commercial investments. Mr. White
is the Regional Director of the Neighborhood Assistance Corporation of America
and serves as a member of the Board of Directors of TCI and IOT. At the time of
his election as a member of the Board of Directors of ARI, Mr. White was also
appointed to serve as a member of the Audit Committee.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits. The following documents are filed as exhibits to this
report:
Exhibit
Designation Description of Exhibit
10.0 Advisory Agreement dated July 1, 2003 between American Realty
Investors, Inc. and Prime Asset Management, Inc.
-3-
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 of the
undersigned hereunto duly authorized.
Date: July 8, 2003. AMERICAN REALTY INVESTORS, INC.
By: /s/ Robert A. Waldman
----------------------------------------
Robert A. Waldman, Senior Vice
President, General Counsel and
Secretary
-4-