FORM 8-K-A
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 30, 1996 (June 15, 1994)
AMERICAN ASSET ADVISERS TRUST, INC.
(Name of registrant as specified in its charter)
Maryland 33-70654 76-0410050
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) Number)
8 Greenway Plaza, Suite 824, Houston, Texas 77046
(Address of principal executive office and zip code)
Registrant's telephone number, including area code: (713) 850-1400
ITEM 1. CHANGES OF CONTROL OF REGISTRANT
Not Applicable
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On June 15, 1994, American Asset Advisers Trust, Inc. (The
"Company"), acquired fee simple title to real estate and
improvements located at 1505 North Town East Boulevard, Mesquite,
Texas, on which there is a Radio Shack store (the "Property").
The Property was acquired by the Company from Ironwood
Development Company for $1,062,439.00. The purchase price was
paid in cash entirely from funds of the Company. The Property is
operated as an electronics retail sales store. The Property
consists of a free standing building located on a tract of land
containing approximately 33,760 square feet. The improvements
consist of a rectangular brick masonry building containing
approximately 5,200 square feet.
The Property was acquired subject to a lease (the "Lease")
with Tandy Corporation, a Delaware corporation. Under the terms
of the Lease, the tenant pays a base rent, plus real estate
taxes, hazard and liability insurance premiums, all utility
costs, and most costs of maintenance and repairs.
Other significant provisions of the Lease are as follows:
1. The original term of the Lease is 15 years. The
original term of the Lease began on November 22, 1991
and will expire on November 30, 2006. The tenant has
the option to renew the lease for two additional terms
of five years each.
2. Base monthly minimum rent during the original term of
the Lease will be $9,075. The base monthly minimum
rent during the renewal option terms will be $10,981.03
during the first term and $12,062.48 during the second
term.
3. In addition to the base rent, the tenant pays
percentage rent equal to the amount by which 2% of the
tenant's gross sales exceed the tenant's yearly base
minimum rent.
4. In addition to the base rent, the tenant pays all real
estate taxes on the Property. The tenant also pays for
all utilities charges.
5. The landlord is required to maintain and repair the
foundation, the exterior walls (excluding windows,
window glass, plate glass and doors), structural
portions of the building, the roof and the drainage
system from the roof. The tenant is required to
maintain and repair all other parts of the Property.
6. The tenant has the right to use the Property as a
retail sales center for the sale of electronics
components.
7. The tenant has the right to assign the Lease or sublet
the Property. However, in the event of an assignment
or sublet, the tenant will remain as the principal
obligor under the Lease.
8. The tenant is required to carry liability insurance in
the amount of $2,000,000 per accident. The tenant is
required to carry hazard insurance coverage on the
Property in an amount equal to the full replacement
value of the improvements.
9. In the event there is a casualty damage after the first
10 years of the lease term and the premises cannot
reasonably be repaired within 120 days from the date of
notification of the damage to the landlord, the Lease
shall terminate.
10. In the event that a substantial portion (i.e., 30% or
more) of the Property is taken by condemnation, the
Lease shall terminate.
Retail stores selling electronic merchandise located in
close proximity to the Property include a Target, a Sears, a Best
Buy, a Circuit City and another Radio Shack.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
Not Applicable
ITEM 4. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT
Not Applicable
ITEM 5. OTHER EVENTS
Not Applicable
ITEM 6. RESIGNATION OF REGISTRANT'S GENERAL PARTNER
Not Applicable
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The tenant of the Property is Tandy Corporation ("Tandy"), a
publicly held corporation. With regard to the financial
wherewithal of the tenant, the registrant based its decision to
acquire the Property upon the credit worthiness of Tandy. With
respect to the financial condition of Tandy, as reported by
management, sales revenues increased 13% to $4.1 billion for the
year ended December 31, 1993, as compared to $3.6 billion for the
fiscal year ended June 30, 1992. (Tandy changed its fiscal year
end from June 30 to December 31 effective December 31, 1992.)
Tandy recorded net income for 1993 of approximately $97 million.
Current assets at December 31, 1993, exceeded current liabilities
by $1.1 billion and total assets exceeded total liabilities by
$1.95 billion. It is the opinion of the management of the
Company, following review of the financial statements of Tandy,
that Tandy's financial condition is sufficient to meet the
investment criteria of the Corporation. Persons interested in
receiving copies of Tandy's publicly issued financial statements
for fiscal year 1993 should contact the Company.
PRO-FORMA FINANCIAL INFORMATION
The following tables present unaudited pro-forma financial
information for American Asset Advisers Trust, Inc., giving
effect to the acquisition of the Property:
PRO-FORMA BALANCE SHEET
MARCH 31, 1994
(unaudited)
Historical Pro-Forma
Costs Adjustments (1)(2) Total
Cash $128,217 $1,068,431 (1) $ 128,217
(1,068,431) (2)
Property - 1,120,831 (2) 1,120,831
(52,400) (2)
Other Assets 66,983 111,599 (1) 126,182
Total Assets 195,200 1,180,030 1,375,230
Shareholders'
Equity 195,200 1,180,030 (1) 1,375,230
Total
Shareholders'
Equity $195,200 $1,180,030 $1,375,230
(1) Includes proceeds from the issuance of 131,552.9 shares of the Company's
stock ($1,315,529) of which $52,400 was applied toward prepaid
acquisition costs, $59,199 toward organization costs and $135,499 toward
syndication costs leaving net proceeds of $1,068,431. Syndication costs
are reflected as a reduction of the $1,315,529 of common stock proceeds
included in shareholders' equity.
(2) Includes total acquisition costs of $1,120,831 for the Property which
consists of $52,400 of acquisition costs paid by the Company to an
affiliate, $5,992 of acquisition costs paid to third parties and
$1,062,439 paid by the Company for the Property.
PRO-FORMA RESULTS OF OPERATIONS
FOR THE PERIOD AUGUST 16, 1993 THROUGH DECEMBER 31, 1993
(unaudited)
Historical Pro-Forma
Costs Adjustments (1) Total
Income $1,606 $40,837 $42,443
Expenses 2,931 7,544 10,475
Net
Income (Loss) ($1,325) $33,293 $31,968
Net Income Per Unit $ .21 (2)
(1) Adjustments include rental income and depreciation from August
16, 1993 to December 31, 1993, as if the Property was owned
and leased by the Company from the date of its incorporation
through December 31, 1993.
(2) Computed on weighted average shares of 151,554.
PRO-FORMA RESULTS OF OPERATIONS
FOR THE PERIOD JANUARY 1, 1994 THROUGH MARCH 31, 1994
(unaudited)
Historical Pro-Forma
Costs Adjustments (1) Total
Income $ 976 $27,225 $28,201
Expenses $ 3,391 $ 5,029 $ 8,420
Net
Income
(Loss) ($ 2,415) $22,196 $19,781
Net Income
Per Share $ .15 (2)
(1) Adjustments include rental income and depreciation from January 1,
1994 through March 31, 1994, as if the Property was owned and leased
by the Company for the full three months.
(2) Computed on weighted average shares outstanding of 131,554.
ITEM 8. CHANGE IN FISCAL YEAR
Not Applicable
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.
American Asset Advisers Trust, Inc.
Date: July 30, 1996 H. Kerr Taylor
H. Kerr Taylor, President
Date: July 30, 1996 H. Kerr Taylor
H. Kerr Taylor, Chief Financial Officer